What is a Candlestick Pattern?
A candlestick pattern shows price action over a certain period. It comprises of four parts:
Open: The price at which the period begins.
High: The highest price reached during the period.
Low: The lowest price reached during the period.
Close: The final price at the end of the period.
Each candle gives you a clue about market sentiment. If the close of a candle is higher than the open price, it is considered a bullish candle and is represented by green color. It indicates buyers are in control. On the other hand, if the close price is below the open price, it shows the sellers are in control, and the candle's color is red.
Candlesticks are important for traders because they represent the market sentiment visually, whether buyers dominate or sellers do not.
