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StockCram is not a broker-dealer, investment adviser, or financial institution. All content is for educational and informational purposes only and should not be construed as personalized investment advice. Consult a qualified financial professional before making investment decisions. Past performance does not guarantee future results.Simple Definition
A type of stock chart where each bar (candle) shows the open, high, low, and close prices for a time period.
Why It Matters
Candlestick charts are the standard way traders and investors view price data. Each candle tells a story: a long green body means strong buying pressure, a long red body means selling pressure, and small bodies with long wicks signal indecision. Learning to read candlesticks is the first step in technical analysis.
Key Points
- Green/white candle: price closed higher than it opened. Red/black candle: closed lower than it opened
- The body shows the open-to-close range; the wicks (shadows) show the high and low
- Patterns like Doji, Hammer, and Engulfing can signal potential trend reversals
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How to Read Stock Charts
Get a complete explanation with examples, key takeaways, and a quiz to test your knowledge.
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Common Questions
A type of stock chart where each bar (candle) shows the open, high, low, and close prices for a time period. Candlestick charts are the standard way traders and investors view price data. Each candle tells a story: a long green body means strong buying pressure, a long red body means selling pressure, and small bodies with long wicks signal indecision.
Candlestick charts are the standard way traders and investors view price data. Each candle tells a story: a long green body means strong buying pressure, a long red body means selling pressure, and small bodies with long wicks signal indecision. Learning to read candlesticks is the first step in technical analysis.
Green/white candle: price closed higher than it opened. Red/black candle: closed lower than it opened
The body shows the open-to-close range; the wicks (shadows) show the high and low
Patterns like Doji, Hammer, and Engulfing can signal potential trend reversals