Trading glossary
A candlestick chart shows open, high, low, and close prices for each period as a body and wicks. Learn how to read candlesticks, clearly and neutrally.
Each candlestick represents price activity over one period, such as a minute, hour, or day. The rectangular body spans the opening and closing prices, while the thin lines above and below, called wicks or shadows, mark the highest and lowest prices reached. Together these four values summarize how price moved during that period.
By convention, a candle is colored one way when the close is above the open and another way when the close is below it. A long body suggests a wide range between open and close, while long wicks show price reached far from where the period settled. Color schemes vary between platforms.
Traders study sequences of candles, sometimes called patterns, to describe recent behavior such as indecision or strong directional moves. These patterns summarize what already happened and are interpreted differently by different analysts. They do not predict future prices and are best used alongside broader context rather than in isolation.
The wicks, or shadows, mark the highest and lowest prices reached during the period. A long upper wick shows price rose then pulled back, while a long lower wick shows it fell then recovered before the period closed.
A line chart usually connects only closing prices, showing overall direction. A candlestick chart shows the open, high, low, and close for each period, giving more detail about the range and movement within it.