Candlestick

Candlesticks are usually composed of the body (black or white), and an upper and a lower shadow (wick). The wick illustrates the highest and lowest traded prices of a security during the time interval represented. The body illustrates the opening and closing trades. If the security closed higher than it opened, the body is white or unfilled, with the opening price at the bottom of the body and the closing price at the top. If the security closed lower than it opened, the body is black, with the opening price at the top and the closing price at the bottom. A candlestick need not have either a body or a wick.

To better highlight price movements, modern candlestick charts (especially those displayed digitally) often replace the black or white of the candlestick body with colors such as red (for a lower closing) and blue or green (for a higher closing).

There are multiple forms of candlestick chart patterns. Here is a quick overview of their names:

1. White candlestick 

Signals uptrend movement (those occur in different lengths; the longer the body, the more significant the price increase).

2. Black candlestick 

Signals downtrend movement (those occur in different lengths; the longer the body, the more significant the price decrease).

3. Long lower shadow 

Bullish signal (the lower wick must be at least the body's size; the longer the lower wick, the more reliable the signal).

4. Long upper shadow 

Bearish signal (the upper wick must be at least the body's size; the longer the upper wick, the more reliable the signal).

5. Hammer 

A bullish pattern during a downtrend (long lower wick and small or no body); Shaven head – a bullish pattern during a downtrend & a bearish pattern during an uptrend (no upper wick); Hanging man – bearish pattern during an uptrend (long lower wick, small or no body; wick has the multiple length of the body.

6. Inverted hammer^[1]

Signals bottom reversal, however confirmation must be obtained from next trade (may be either a white or black body); Shaven bottom – signaling bottom reversal, however confirmation must be obtained from next trade (no lower wick); Shooting star – a bearish pattern during an uptrend (small body, long upper wick, small or no lower wick).

7. Spinning top white 

Neutral pattern, meaningful in combination with other candlestick patterns.

8. Spinning top black 

Neutral pattern, meaningful in combination with other candlestick patterns.

9. Doji^[2] 

Neutral pattern, meaningful in combination with other candlestick patterns.

10. Long legged doji 

Signals a top reversal.

11. Dragonfly doji^[3] 

Signals trend reversal (no upper wick, long lower wick).

12. Gravestone doji 

Signals trend reversal (no lower wick, long upper wick).

13. Marubozu white^[4] 

Dominant bullish trades, continued bullish trend (no upper, no lower wick).

14. Marubozu black 

Dominant bearish trades, continued bearish trend (no upper, no lower wick)