GETTING STARTED WITH CANDLESTICKS (A Thread)

1. Originated in Japan, by a rice merchant named Homma to track market prices

and daily momentum with a strong believe that there was a link between price
and the supply and demand of rice and the markets were strongly influenced
by the emotions of traders, CANDLESTICK PATTERNS since then have been
used to demonstrate same emotions by visually representing the size of price
moves with different colors.
2.  A daily candlestick shows the market's open, high, low, and close price for
the day. The candlestick has a wide part, which is called the "real body” and a
“shadow”. 

3. The real body represents the price range between the open and close of that
day's trading. And upper shadow represents the highest price whereas lower
shadow represents the lowest mark on price.
4. Patterns are separated into bullish and bearish. Bullish patterns, green in colour
indicate that the price is likely to rise, while bearish patterns, red in colour
indicate that the price is likely to fall. Another type of candlestick is called doji.

No pattern works all the time, as candlestick patterns represent tendencies in

price movement, not guarantees.
5. We can set time frames to check the price deviation in the form of candle sticks,
time frame may range from a few seconds to a month. Thus a candlestick formed
will be represented as per the same time frame.
6. The most bullish or most bearish candlestick is called the Marubozu. Such a
candlestick indicates that there is so much buying/selling interest in a stock that
the market participants were willing to buy/sell the stock at every price point
during the day, so much so that the stock closed near its high/low point for
theday.

7. The doji often shows that the open and close prices are equal. Doji’s provide
crucial information about the market sentiments and is an important candlestick
pattern. It signals that there is indecision is the market. The market can swing
either way and you need to build a stance that adapts to the expected movement
in the market.
8. The hammer, consists of small real body at the upper end of the trading range
with a long lower shadow. The bullish hammer is a significant candlestick pattern
that occurs at the bottom of the trend. The longer the lower shadow the more
bullish it is.
9. 𝗧𝗵𝗲 𝗦𝗵𝗼𝗼𝘁𝗶𝗻𝗴 𝘀𝘁𝗮𝗿 [or, 𝘐𝘯𝘷𝘦𝘳𝘵𝘦𝘥 𝘏𝘢𝘮𝘮𝘦𝘳] is a top reversal pattern, it has a long
shadow on top and the body follows by. A shooting star signals a market high.
Since the shooting star is seen after a high, the pattern signals selling pressure.
seen after a downtrend, it shows demand.
10. The candle is said to be the best bullish when closing point= highest point, thus
the closer the closing point and highest point are the bullish the candle is.