Japanese Candlesticks for Beginners

Japanese candlesticks are one of the most important tools in technical analysis in the world of cryptocurrency trading, helping you understand price movement and market psychology over a specific period.

What is the structure of a candle? (Candle Structure):

1. Body: Shows the difference between the opening price (Open) and the closing price (Close).

2. Wicks: Represent the highest and lowest price reached by the asset during the same period.

3. Color:

Green Candle (Bullish Candle): The price closed higher than the opening – indicating an upward trend.

Red Candle (Bearish Candle): The price closed lower than the opening – indicating a downward trend.

Examples of common candles:

Hammer: Often appears after a decline and may indicate a bullish reversal.

Doji: Indicates a balance between buying and selling forces, signaling indecision.

Engulfing: A large candle that engulfs the previous candle, indicating a potential change in direction.

Tip for beginners:

Do not rely on just one candle shape. Read the full market context and use supporting tools like technical indicators and support & resistance levels.

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