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One of the important indicators that aid traders understand candlestick charts are candlestick patterns. Candlestick patterns are valuable for making effortless systems that will advise you regarding the establishment of a trend in order for you to start trading.

The open, high, low, close market price of the stock, commodity or currency over a period of time is displayed in the candlestick form. This period can be selected by the trader.

Day traders typically choose 5 minutes though 15 minutes could be your choice for certain cases. For longer term trading you can choose longer periods.

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The body of the candle records the difference between the open and close values. If it’s green/blue (for colored charts) or white then the lower borders of the rectangular body is the open and price went up during the particular period. A red (for colored charts) or black indicates the uppermost boundary is the opening price, while the price fell during that period.

The wick is the title given to the vertical lines that usually stick up from the top and down from the bottom of the candle body. The top of the upper part of wick is the highest spot that the price ever hit during the period. The bottom of the lower wick is the low.

This kind of analysis allows the trader to know at a glance if values tumbled or went up during the analysis time frame. Bear markets are illustrated by green or white candles whereas bull markets are represented by red or black candles.

The association of open and close values to high and low values can be discerned immediately. You may have a candle that is conclusively solid, minus the wick.

It’s called a Marubozu pattern. Prices never went more or lower than the opening and closing prices in this case.

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he high value as opening price and low value as closing price is represented by the red or black candle. If it is white or green, the opening rate was the low and the closing value was the high.

A long body means a relatively steady movement either up or down. A reversal is determined by a long wick on the top or on the bottom.

A candlestick has to be interpreted along with the previous ones in order to ensure accurate trending. From there relatively elaborate trends can be devised to delineate the trends in the future.

Note: Currency investing is not risk free, can result in substantial losses, and is not suited for every person.