Candlestick Chart
A candlestick chart shows the opening price, highest price, lowest price, and closing price for a time period in one simple visual.
Start the lessonIntroduction
A candle tells a story in one time frame
A candlestick chart is one of the most common tools used in technical analysis. Each candle represents a time period—such as 1 minute, 1 day, or 1 week—and shows the price movement during that period.
The short answer
A candle tells you where the price opened, how high it went, how low it fell, and where it closed. That gives a quick picture of buying and selling pressure in that period.
How to read one
Open, high, low, close
Bullish candle
The close is above the open. It usually suggests buyers were stronger than sellers in that period.
Bearish candle
The close is below the open. It usually suggests sellers were stronger than buyers.
Wicks
The top and bottom shadows show the highest and lowest traded level during the period.
Simple example
A day of trading in one candle
Suppose a stock opens at ₹100, rises to ₹112, falls to ₹96, and closes at ₹108.
Price data
- Open: ₹100
- High: ₹112
- Low: ₹96
- Close: ₹108
Interpretation
The close is above the open, so this is a bullish candle. The wick shows the price moved lower during the session, but buyers pushed the stock up by the end.
Interactive check
This candle is Bullish. Movement from open to close is ₹8.00. High is ₹112.00 and low is ₹96.00.
Common mistakes
Candles are clues, not certainty
Reading one candle in isolation
A single candle is easier to understand when viewed with the surrounding trend and volume.
Ignoring context
A bullish candle near strong resistance may behave differently than one in a strong uptrend.
Assuming all candles are the same
The size of the body, wick length, and closing position all matter.
Forgetting risk management
Even a strong-looking candle should be judged with stop-loss discipline and position sizing.
Key points
What to remember
- A candlestick shows the open, high, low, and close for a time period.
- The body shows the difference between open and close.
- The wick shows the highest and lowest traded price reached during the period.
- Bullish candles often mean buyers won the session; bearish means sellers were stronger.
- Candlesticks are useful for understanding price action, but not a guarantee of future outcomes.
- Combine candles with trend, support, resistance, and risk management for better context.
This lesson is for education only, not personalized financial, tax, or investment advice. Investments may rise or fall and are subject to market risks.
Test yourself
5-question quiz
Choose one answer for each question, then check your score.