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Candlestick

In one line: A chart bar that shows the open, high, low and close of a time period.

Each candle sums up one period (one minute, one hour, one day). The fat part is the body: from the open to the close. The thin lines are the wicks: the highest and lowest prices.

Often a green or white body means the price closed higher than it opened, and red or black means lower. Colours are a chart setting, not a law of nature.

Read the beginner guide How to read a candlestick chart. Candlestick patterns are a separate topic, see Doji, Hammer and Engulfing pattern.

A myth to bust: you often read that the rice trader Homma invented candlestick charts in the 1700s. A 2016 prize paper in the journal of Japan's technical analysts association (NTAA) searched the National Diet Library's digital archive. It concludes that this popular claim is wrong: candlestick charts appeared later, in the Meiji era (after 1868).

Related

Sources & studies

  1. Investopedia (secondary): Candlestick
  2. NTAA Journal Vol. 3 (2016): Tracing how candlestick charts came about (Japanese, PDF)

Trading termsTimeframeHow to read a candlestick chart

Last checked: 2026-11-04 · Educational, not financial advice.

Education only, not financial advice. No signals. Backtests are hypothetical: real trading can be worse. Past results don't predict future results.