Candlestick Chart

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Definition of 'Candlestick Chart'

Candlestick Charts are a very popular way to represent the prices of stocks, futures and commodities over a given time period. That time period can be as little as 1 minute (or even less) and as large as one year (or even more). Here is an example of a candlestick chart:
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Example of a Candlestick Chart

Each candle in the chart shows the Open, High, Low, and Closing price of a security. The body of the candle is shown as the difference between the Open and Close price. The candle wicks show the difference between the High and Low and the Open and Close.

If the opening price is lower than the closing price then the body of the candle will be green or white showing that the security had a positive gain or up move.

If the opening price is higher than the closing price then the body will be red or black showing the move during this time period was down.

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Candlesticks are used in many popular trading strategies suck as:

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