CHAPTER 01: Introduction To Candlestick Charting

Candlestick charting was invented in Japan. Hence it is also known as Japanese Candle. The use of candlestick charts is the best and straightforward compared to all other chart types. 

Different signals are obtained using a single candle or a combination of several candles. Using two or more candles, it is possible to predict whether the current improvement or decrease will continue.

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The candlestick consists of three main parts.

• Real body.
• Upper body.
• Lower body.

Real Body :

• The center of the candlestick is called the real body.
• The size of the real body depends on the amount of growth and decline that day.
• The green or blue candle is used for improvement while the red candle is used for the downward direction.
• If there is no increase or decrease in the price, then the candle that is made is called Doji.

Upper Shadow :

• The Upper Shadow is a line formed at the top of the real body which represents the highest price of the day.

Lower Shadow :

• The lower shadow is the line formed in the lower part of the real body which indicates the lowest price of the day.

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