In trading beginners get stuck in certain places due to fluctuating market prices. Here you can see understanding candlestick charts and how to identify high probability trading setups so you can be profitable highly in the entire markets. Those who are new to trading and you are unaware of understanding candlestick charts and patterns you can see step by step even you don’t have the experience you can excel in pro.
What is a candlestick pattern?
A candlestick pattern is essentially a method of reading price charts and it is originated back in Japan that is history. The key component of the candlestick chart shows the four things, it shows you the opening price; the price high of the session, the low of the session, and the closing price. If you look at the candlestick chart in one hour time period or in a day.
How to read candlestick charts?
Four main components you have to keep in mind that is the open, the close, the high, and the low.
- The candles are usually two typical colours Green, Red perhaps can be black and white you can change the colours generally the most common colour is green and red.When you see the green colour the price has closed higher for the session. The black shadow in the upper and lower part is called a wick. In red candlestick the open is in up and the close is in down.
- The main difference between the bearish bar and the bullish bar is open and close. The candlestick pattern is of two main components that are body part and the black shadow is called the wick part. Body tell you that who is in strong control, though the buyers push price up. However, the wick shows that there is the price rejection of higher prices.
What is the size of the body?
When there are weak buyers in control the body size reduces and there is an immense amount of strong selling pressure shows the strong price rejection, which pushes the price lower. Simply telling that the wick is longer than the body shows the strong price rejection is the main understanding Candlestick pattern chart.
[ Must Read – Difference Between Chart Pattern and Candlestick Pattern ]
Candlestick chart shows you who’s in control that is wick and body size decides bearish and bullish. Pay attention to the body wick, and the body relative to the wick.
Candlestick on different time-frames:
Candlestick chart can appear daily even every one hour, one of the bars was painted simultaneously every one hour. In the daily time frame, every single bar is painted. Combining Candlestick patterns is another basic understanding of the candlestick charts. When two candles combined last two hours the open and closing price is high and low. This is very useful to see in the one-hour time frame and you can't mix a sense of it. Candlestick patterns are very powerful and it an entry trigger for trading.
Five powerful entry trigger to increase high probability.
- Engulfing pattern
- Hammer and shooting star
- Dragonfly and Gravestone Doji
- Morning and evening star
- Tweezer bottom and top
You can ride in trading powerfully using these effective points.