🕯️ What is a Japanese candlestick chart?

A Japanese candlestick chart is a type of financial chart that shows the price movement of a cryptocurrency (like Bitcoin) over a specific period of time — such as one minute, one hour, or one day.


Each candle represents 4 main things:


  • Opening price (where the price started)


  • Highest price


  • Lowest price


  • Closing price (where the price ended)



    📈 Components of the Japanese candle

Imagine the candle looks like this:


High

┌─────┐

│ │ ← Body (between open and close)

└─────┘

Low



Body:


  • If the closing price is higher than the opening price → the candle is green (bullish) → buyers were stronger.


  • If the closing price is lower than the opening price → the candle is red (bearish) → sellers were stronger.



Shadows (Wicks):


  • The thin lines above and below the body show how much the price rose or fell during that period.




🟩 Example of a green candle (bullish):

  • Opening price at the bottom of the body.


  • Closing price at the top of the body.




Means: the price increased



High

┌─────┐ ← Close

│ │

│ │

└─────┘ ← Open

Low



🟥 Example of a red candle (bearish):

  • Opening price at the top of the body.


  • Closing price at the bottom of the body.




Means: the price decreased




High

┌─────┐ ← Open

│ │

│ │

└─────┘ ← Close

Low