Hello everyone, as we all know the market action discounts everything :)
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A lot of people wanna start trading but they don't know where to start, So i decided to create a series of videos to help new traders understand the Market, Charts, and Patterns.
Today's video will be about the Candlestick Chart and it's going to be Part 1 out of 3
So let's start with talking about the candlestick chart in general:
In the 1700s, a Japanese man named Homma discovered that, while there was a link between price and the supply and demand of rice, the markets were strongly influenced by the emotions of traders.
Candlesticks show that emotion by visually representing the size of price moves with different colors. Traders use candlesticks to make trading decisions based on regularly occurring patterns that help forecast the short-term direction of the price.
There are 3 different types of Candles :
Bullish Candle
Bearish Candle
Doji
1) Bullish Candle
A Bullish candlestick shows the market's open, high, low, and close price for the day. The candlestick has a wide part, which is called the "real body." Bullish means that the market is going up.
This real body represents the price range between the open and close of that day.
The Shadow or wick or tail represent the high and low of the market.
2) Bearish Candle
A Bearish candlestick shows the market's open, high, low, and close price for the day. The candlestick has a wide part, which is called the "real body." Bearish means that the market is going down.
This real body represents the price range between the open and close of that day.
The Shadow or wick or tail represent the high and low of the market.
3) Doji
The Doji has 5 Different types :
Standard Doji
A Standard Doji is a single candlestick that does not signify much on its own. To understand what this candlestick means, traders observe the prior price action building up to the Doji.
Trades based on Doji candlestick patterns need to be taken into context. For example, a Standard Doji within an uptrend may prove to form part of a continuation of the existing uptrend. But it could be a reversal of an uptrend which shows the importance of confirmation post the occurrence of the Doji.
Long-legged Doji
The Long-Legged Doji simply has a greater extension of the vertical lines above and below the horizontal line. This indicates that during the timeframe of the candle price action dramatically moved up and down but closed at virtually the same level that it opened. This shows the indecision between the buyers and the sellers.
Dragonfly Doji
The Dragonfly Doji can appear at either the top of an uptrend or the bottom of a downtrend and signals the potential for a change in direction. There is no line above the horizontal bar which creates a ‘T’ shape and signifies that prices did not move above the opening price. A very extended lower wick on this Doji at the bottom of a bearish move is a very bullish signal.
Gravestone Doji
The Gravestone Doji is the opposite of the Dragonfly Doji. It appears when price action opens and closes at the lower end of the trading range. After the candle open, buyers were able to push the price up but by the close they were not able to sustain the bullish momentum. At the top of a move to the upside, this is a bearish signal.
4 Price Doji
The 4 Price Doji is simply a horizontal line with no vertical line above or below the horizontal. This Doji pattern signifies the ultimate in indecision since the high, low, open and close (all four prices represented) by the candle are the same. The 4 Price Doji is a unique pattern signifying once again indecision or an extremely quiet market.
I hope that I was able to help you understand The basics of The Candlestick Chart and if you have any more questions don't hesitate to ask.
Hit that like if you found this helpful and check out my other video about the Moving Average, Stochastic oscillator, The Dow Jones Theory, How To Trade Breakouts, The RSI , The MACD , The Bollinger Bands and The Different Types Of Trading Strategies links will be bellow
_________________________________Make sure to Like and Follow if you like the idea_________________________________
A lot of people wanna start trading but they don't know where to start, So i decided to create a series of videos to help new traders understand the Market, Charts, and Patterns.
Today's video will be about the Candlestick Chart and it's going to be Part 1 out of 3
- Part 1 will be about the theory and structure of the Candlesticks and the different types of Candles.
- Part 2 will be about Candlesticks Reversal Patterns.
- Part 3 will be about Candlesticks Continuation Patterns.
So let's start with talking about the candlestick chart in general:
In the 1700s, a Japanese man named Homma discovered that, while there was a link between price and the supply and demand of rice, the markets were strongly influenced by the emotions of traders.
Candlesticks show that emotion by visually representing the size of price moves with different colors. Traders use candlesticks to make trading decisions based on regularly occurring patterns that help forecast the short-term direction of the price.
There are 3 different types of Candles :
Bullish Candle
Bearish Candle
Doji
1) Bullish Candle
A Bullish candlestick shows the market's open, high, low, and close price for the day. The candlestick has a wide part, which is called the "real body." Bullish means that the market is going up.
This real body represents the price range between the open and close of that day.
The Shadow or wick or tail represent the high and low of the market.
2) Bearish Candle
A Bearish candlestick shows the market's open, high, low, and close price for the day. The candlestick has a wide part, which is called the "real body." Bearish means that the market is going down.
This real body represents the price range between the open and close of that day.
The Shadow or wick or tail represent the high and low of the market.
3) Doji
The Doji has 5 Different types :
Standard Doji
A Standard Doji is a single candlestick that does not signify much on its own. To understand what this candlestick means, traders observe the prior price action building up to the Doji.
Trades based on Doji candlestick patterns need to be taken into context. For example, a Standard Doji within an uptrend may prove to form part of a continuation of the existing uptrend. But it could be a reversal of an uptrend which shows the importance of confirmation post the occurrence of the Doji.
Long-legged Doji
The Long-Legged Doji simply has a greater extension of the vertical lines above and below the horizontal line. This indicates that during the timeframe of the candle price action dramatically moved up and down but closed at virtually the same level that it opened. This shows the indecision between the buyers and the sellers.
Dragonfly Doji
The Dragonfly Doji can appear at either the top of an uptrend or the bottom of a downtrend and signals the potential for a change in direction. There is no line above the horizontal bar which creates a ‘T’ shape and signifies that prices did not move above the opening price. A very extended lower wick on this Doji at the bottom of a bearish move is a very bullish signal.
Gravestone Doji
The Gravestone Doji is the opposite of the Dragonfly Doji. It appears when price action opens and closes at the lower end of the trading range. After the candle open, buyers were able to push the price up but by the close they were not able to sustain the bullish momentum. At the top of a move to the upside, this is a bearish signal.
4 Price Doji
The 4 Price Doji is simply a horizontal line with no vertical line above or below the horizontal. This Doji pattern signifies the ultimate in indecision since the high, low, open and close (all four prices represented) by the candle are the same. The 4 Price Doji is a unique pattern signifying once again indecision or an extremely quiet market.
I hope that I was able to help you understand The basics of The Candlestick Chart and if you have any more questions don't hesitate to ask.
Hit that like if you found this helpful and check out my other video about the Moving Average, Stochastic oscillator, The Dow Jones Theory, How To Trade Breakouts, The RSI , The MACD , The Bollinger Bands and The Different Types Of Trading Strategies links will be bellow
