CANDLESTICK

23 January 2017 By PDSNET

An individual display of the high, low, open and close of a specific security over a period of time. A candlestick chart is composed of multiple candles, each of which represent the sentiment of bulls and bears over the period chosen. The body of the candle shows the opening prices and closing prices of the security: a red/black candle is displayed when the closing price is below the opening price for the period; a green/white candle is displayed when the opening price is above that of the closing price for the period. The shadows on the top and bottom of a candle express how high and how low the price went during the period, and comparing this to the open and close is important to determine investor sentiment. There are many candlestick formations which give signals in a chart and assist the investor in getting into and out of a share.



Share this glossary term: