What is the Japanese Candlestick Chart ๐ฏ๏ธ๐ฏ๏ธ๐๐๐โ๏ธโ๏ธโ๏ธ
It is a technical analysis tool used to represent price movements in financial markets. The chart consists of a series of candles that represent a specific time period and provide information about opening and closing prices, as well as the highest and lowest prices during that period.
To read Japanese candlestick charts, you must understand the following components: โคต๏ธโคต๏ธ๐ฏ๏ธ๐ฏ๏ธ๐ฏ๏ธ
1๏ธโฃ *Body of the candle*: Represents the difference between opening and closing prices. If the closing price is higher than the opening price, the candle is bullish (green or white). If the closing price is lower than the opening price, the candle is bearish (red or black).
2๏ธโฃ *Shadows*: Represent the highest and lowest price during the time period.
3๏ธโฃ *Opening*: The price at which the candle opened.
4๏ธโฃ *Closing*: The price at which the candle closed.
Types of Japanese Candlestick Patterns
There are many Japanese candlestick patterns that can be used to analyze the market, including:
1๏ธโฃ *Hammer*: A bullish candle with a long lower shadow.
2๏ธโฃ *Inverted Hammer*: A bullish candle with a long upper shadow.
3๏ธโฃ *Shooting Star*: A candle with a small body and long shadows.
4๏ธโฃ *Bearish Engulfing Pattern*: A bearish candle following a bullish candle, indicating a potential reversal in direction.
5๏ธโฃ *Bullish Engulfing Pattern*: A bullish candle following a bearish candle, indicating a potential reversal in direction.
