What is Candlestick Pattern ?

If you are trading you have come up with write space. i will give you information about technical analysis. if you want to know where to buy, where to sell, where to stop loss and where book profit in running market then so please read the full post. First of all we need to know what is chart?

What is chart?

chart is graphical representation of price data shows a stock price plotted in many time frame. if you are trader then many times you seen this type of chart. First we talk about candlestick. Candlestick charts are thought to have been developed in the 18th century by Munehisa Homma, a Japanese rice trader. They were introduced to the Western world by Steve Nison in his book, Japanese Candlestick Charting Techniques. Now i am explain you how candlestick made. To assume ABC stock open price is 500$, all day long stock high price is 700$ and stock low price is 300$ and all day stock closing price is 650$. The section between stock open price and close price that is called body of candle and close to high part or line to called upper shadow or upper tick as well as open price to low price called lower shadow or lower tick.i am giving to candle pattern representation in image, so easy to you better understand.

Now we know how many types of candlestick pattern. Candlesticks are two types:

1. Bullish Candlestick
2. Bearish Candlestick

• Bullish Candlestick

Bullish candlestick show boom in stock market. When made bullish candlestick then it’s body color green or white. In bullish candle stock open price in bottom and stock close price in top.

• Bearish Candlestick

Bearish candlestick show financial crisis in stock market. When made bearish candlestick then it body color is red or black, so traders are easily understand stock market movement. In bearish candlestick stock open price in top and stock close price in bottom.

So friends i hope you are understood about what is candlestick pattern. My next post i will explain how many types of candlestick pattern made in running market and how we will take trade and book profit. So friends if you have any suggestion for post and other kind of then give me suggstion.