As I promised. Here is a little lesson on candlesticks!
What are Japanese candlesticks and why does everyone in crypto use them? 🕯️📊
I'll explain it quickly and straightforward: Japanese candlesticks are charts that show how the price of a cryptocurrency has moved over a specific period of time (it can be 1 minute, 15 minutes, 1 hour, 1 day, etc).
Each candlestick tells a story of what happened during that time and is composed of:
1️⃣ Body:
It is the thick rectangle of the candlestick.
If it is green: the price closed higher than it opened.
If it is red: the price closed lower than it opened.
2️⃣ Wicks (lines above and below the body):
The upper line shows how high the price went before it dropped.
The lower line shows how low the price went before it rose.
Why is this important?
Because by looking at several candlesticks together, you can understand if more people are buying or selling, and anticipate what might happen.
For example:
If you see several consecutive green candles with large bodies, there is buying strength, but be careful, because this can create FOMO and a correction (drop) might come soon.
If you see long wicks upward and small bodies, it means they tried to rise but the price was rejected... it could start to drop.
And if you see several red candles with wicks below, it may indicate that the price has already hit the bottom and a bounce will happen soon.
Real fact:
Many traders make profits just by analyzing these candles and their patterns. You don't need expensive indicators or weird bots, just understand the candles well.
If you want me to teach you the basic patterns (like hammer, doji, engulfing, etc). Don't forget to comment, like, and follow me. I'll make it easy and straightforward for you! 🚀.
Best regards!