What are Japanese candlestick patterns?

Japanese candlestick patterns are motifs that appear on trading charts. Technical traders believe that you can use them to predict future price action – which makes them useful for finding new potential opportunities. In technical analysis, the only factor you consider when researching a market is its price chart.

What do Japanese candlesticks mean in terms of price action?

Let’s take a look at each type of candlestick and what they mean in terms of price action. Japanese candlesticks with a long upper shadow, long lower shadow, and small real bodies are called spinning tops. The color of the real body is not very important. The Spinning Top pattern indicates the indecision between the buyers and sellers.

What is a green candlestick pattern?

There are three candlesticks that make up this pattern. First, you’ll have a large green candlestick that’s part of a previous uptrend. Then, you’ll get a green candlestick with a short body – this means that there is some bearish sentiment appearing, but not enough to reverse yet.

What is a candlestick chart?

A candlestick chart illustrates an asset's historical price movement over time. Depending on the timeframe, each candlestick indicates a certain period. If you choose the monthly chart, each candlestick represents one month's price movement. Japanese rice traders invented candlestick charts to track rice prices. What is a candlestick?