* Basics of Candles: Japanese candles are the visual language of cryptocurrency trading. Each candle tells a price story for a specific time period (Open, Close, High, Low).
* Body and Shadows: The body of the candle represents the opening and closing range, while the shadows (wicks) show the highest and lowest price the asset reached during that period.
* Colors Matter: A green (or white) candle means the closing price is higher than the opening price (up), while a red (or black) candle means the closing price is lower than the opening price (down).
* Reversal Patterns: Learning patterns such as 'Hammer', 'Hanging Man', 'Bullish/Bearish Engulfing', and 'Stars' (Doji, Morning/Evening Star) can indicate an imminent change in trend.
* Continuation Patterns: Patterns such as 'Marubozu' or 'Double Top/Bottom' (can be seen by grouping candles) may indicate a continuation of the current trend.
* Strength of Buyers and Sellers: The size of the candle's body and the length of the shadows reflect the strength of buying or selling pressure. A long body indicates strong price movement.
* Context is King: Do not rely on a single candle. Always read candles in the context of the overall market trend, support and resistance levels, and other indicators.
* Risk Management: Using Japanese candles helps identify potential entry and exit points, but the most important thing is to adhere to strict risk management and set stop-loss levels.
* Practical Application: Practice reading candles on live charts of various cryptocurrencies. The more you practice, the clearer your vision becomes.
* Using with Other Indicators: For more accurate analysis, combine Japanese candlestick patterns with other technical indicators such as the Relative Strength Index (RSI), moving averages (MAs), or trading volumes.