🔍 What is a Candlestick?
A candlestick represents price movement within a specific time frame (e.g., 1 min, 5 min, 1 hour, 1 day).
Each candle has 4 main components:
Open: The price when the candle started.
Close: The price when the candle ended.
High: The highest price reached during that period.
Low: The lowest price during that period.
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🕯️ Structure of a Candle
Each candle consists of:
Body: The thick part (between open and close).
Wick (or Shadow): The thin line (above and below the body, showing the high and low).
🔴 Bearish Candle (Price went down):
Open is at the top, Close is at the bottom (usually red).
🟢 Bullish Candle (Price went up):
Open is at the bottom, Close is at the top (usually green).
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⏱️ Timeframes Matter
On Binance, you can choose timeframes like:
1m (1 minute)
15m
1H
4H
1D (1 day)
A 1-hour candle shows how price moved within 1 hour. A 1-day candle shows one full day’s movement.
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📊 Basic Candlestick Patterns
Some patterns traders use to predict trends:
1. Doji (Indecision)
Open ≈ Close; tiny body.
Shows uncertainty—price could reverse.
2. Hammer (Reversal)
Small body with long bottom wick.
Often appears at the bottom of a downtrend (bullish sign).
3. Shooting Star (Reversal)
Small body with long top wick.
Appears at the top of an uptrend (bearish sign).
4. Engulfing Patterns
Bullish Engulfing: A green candle completely covers the red one before it → possible upward move.
Bearish Engulfing: A red candle covers the previous green one → potential drop.
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🔑 Tips for Using Candlesticks
Always check volume—strong moves with volume are more reliable.
Use support/resistance levels with candlestick patterns.
Combine with indicators (like MACD, RSI) for confirmation.
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