What is a Candlestick?

A candlestick is an integral element of a candlestick chart that gives information about the asset price for a given period depending on the selected time frame. The candlestick displays assets’ open, close, high, and low prices, and it has three elements: the upper shadow, the body, and the lower shadow. The candlestick body shows the price range between the open and close prices for the selected period. For instance, on a daily time frame, the body of a candlestick shows the price range for a specific day.

A top-to-bottom look at a “bear” candlestick shows the period’s high, open, close, and low prices. On the other hand, a top to bottom looks at a “bull” candlestick presents the high, close, open, and low price for the selected period. Hence, if the open price is below the close price, it indicates a bullish candlestick, while a bearish candlestick is identified when the close price is lower than the open price. Commonly, a bullish candlestick is represented in green color, whereas a bearish candlestick is in red.

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