What is Candle Stick Pattern & How to Work?
Japanese Candlestick was first introduced by Japan, since then this candlestick pattern has been in use, and the most used chart in the stock market is Japanese Candlestick.
Candlestick is a tool used a technical analysis to represent the price movement of a stock, commodity, or currency. Most technical analysts use these candlesticks to identify potential price movements and trends in financial markets.
Whose structure is made up of opening, closing, high, and low prices, there are two types of candles in it, one bullish candle and one bearish candle. so let us understand it briefly,
1. BULLISH CANDLE
In a bullish candle, the opening of the stock is at the lower level, and its closing is at the upper level, meaning the stock will open at the bottom and close at the top. In this way, after opening, a low of a few points will be made at the lower level, which will be called lower shadow or lower wick. Similarly, a high will be created at the upper level, which will be called the upper shadow or upper wick, then this is how the structure of a bullish candle is formed, and it is called a bullish candle. You can see it in the picture given above.
2. BEARISH CANDLE
In a bearish candle, the opening of the stock is at the upper level, and its closing is at the lower level, meaning the stock will open at the top, and will close at the bottom. In this way, after opening, it will create a HIGH of some points at the upper level, which will also be called upper shadow or upper wick, similarly, it will create a low at the lower level, which will be called lower shadow or lower wick, so the structure of bearish candle is like this. It happens, and it is called a bearish candle. as you can see in the picture given above.
TIME FRAME
The time period of a candle can be anything 1 minute 3 minutes 5 minutes 15 minutes 30 minutes 1 hour 1 day, if we use any time period, any time period will be used then only one candle will be formed for that above, Shown in the picture.