Candlestick chart

A candlestick chart is a widely used method of visualising price movements across financial and commodity markets. Each candle represents a chosen time period and displays four key data points: the opening price, closing price, highest price, and lowest price. The body of the candle shows whether the market moved up or down during that interval, while the wicks indicate the extremes reached. This structure provides far more information than a simple line chart, offering insight into volatility, intraperiod momentum, and the balance between buying and selling pressure. Traders across asset classes—currencies, equities, commodities, energy products, and derivatives—use candlestick charts to interpret short-term sentiment and identify patterns associated with reversals or continuation of trends. Common formations such as hammers, engulfing candles, or doji patterns can suggest changes in conviction or indecision among market participants. While candlestick analysis is not predictive on its own, it is valuable when combined with broader technical or fundamental context. Its visual clarity makes it a preferred tool for discretionary traders and algorithm designers alike, as it neatly captures both price action and market psychology.