What a candlestick actually tells you
Open, high, low and close — and why the same candle means different things in different places.
A candlestick compresses a period of trading into four prices: open, high, low and close.
Anatomy
- Body — the range between open and close. Filled or red when close < open; hollow or green when close > open.
- Wicks (shadows) — the extremes reached during the period that price did not hold.
What it can tell you
A long lower wick says price traded lower and was bought back up within that period. A large body with small wicks says one side controlled the period. That is all — it is a summary of what happened, not a forecast.
Context over shape
A small-bodied candle with long wicks (a "doji") at a multi-week high means something different from the same candle in the middle of a range. Named candlestick patterns only become useful when combined with location: structure, levels or zones.
Timeframe changes everything
A single daily candle contains 24 hourly candles. A bullish daily candle can hide a sharp intraday sell-off. When a candle looks significant, check the timeframe below it to see how it was built.
Next steps
Learn how swings form from sequences of candles in Reading market structure.
Educational content only — not financial advice. Trading involves risk of loss.
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