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How To Read Candle Chart in Trading Online

Of the many stock analysis tool, candle charts or candlestick charts is one that is often used to analyze the analysts' stock price movements. The graph is formed from a series of candlesticks wheelbase form, often appears in the piece reviews the analysts on the website or journal.

Candle chart is basically similar to a bar graph (bar chart) showing the movement of the highest to the lowest stock price since the opening until the close of stock trading session. Candle chart emphasizes the difference in price at the time of opening and closing, as well as showing the increase and decrease in price on a particular session. Drafting sessions can be based on the candle chart monthly, weekly, daily, or even between sessions in a day exchanges.
  • The information displayed
When observed, per unit consists of one candle stick rectangular shape and two similar lines in the axes above and below the candles.
Rectangular shapes that resemble candlesticks, often called "real body" which indicates the position of the opening and closing stock prices. For example, the stock price opened at a price of Rp 5,000 per share, and up to $ 5500 at closing. To show whether there is an increase or decrease in the share price at the opening until closing, generally are colored candles. Green or white when the closing price is higher than the opening (up candle), and red or black when the closing price is lower than the opening (down candle).

During the trading session the stock was highly likely the stock price higher or lower than the price at the opening and closing. The position of highs and lows are indicated by the end of the line above and below the real body, which resembles a candle wick (wick). The stock analysts often also called wick candle as a shadow. The space between the top and the bottom end of the axis is the range of movement of stock prices during the trading session.

Possible, these rods do not have a candle wick up or down when the highest and lowest share price equal to the price at the opening and closing. Can also occur, only the wick-wick-looking, when the opening price equal to the closing price.
  • Wax forms an important
Stock price movements will form a stem and a different candle wick."There are four candlestick pattern that is important to note," said Andrew Horowitz, one of the expert consultant.

Doji Candle: This pattern occurs when the difference in share price when the opening and closing the session is very thin or even exactly the same, although there is movement throughout the session exceeds or is lower than the opening price and closing. Those concerned about the stock would mean that the Doji signals indecision is thus considered as the market was not the time to make decisions transacts. The appearance of Doji reflects that during the session, buyers and sellers of stock prices tug each other, so that at the closing session of the stock price to be equal or nearly equal to the time of opening. Doji is also often defined by a reversal of the trend of increase or decrease in prices, so investors will be cautious response to the appearance of Doji. Especially if there is a high enough price movement during the trading session the stock.

Spinning Top: In principle, similar to the Spinning Top Doji, unless there is a difference in the price of opening and closing - although not very big difference. This pattern is characterized by upper and lower axis and short candles. It looked like children's games can be played like a propeller. Similar to the Doji, Spinning Top also responded to the emergence of stock watchers as a signal of market indecision, potentially reversing the direction of the trend of stock price movement.

Unlike Doji and Spinning Top which indicates market indecision, Hammer and Shooting Star patterns clearly indicate a bullish trend (excited) or bearish (lethargic). Hammer and Shooting Star emergence occurred only after a certain trend in stock prices moving, and almost always associated with a reversal of the price.

Hammer: Although similar to the Spinning Top, where there is a difference between closing and opening price is not too large, but the Hammer Candle have a substantial price difference between the lowest share price during the trading session opening or closing prices. Hammer on bullish conditions, under the candles wick is long enough, while on the candle wick nearly or completely absent.Hammer is a bullish reversal signals a potential trend of stock price movement. Hammer called because investors typically seek to "strike back" after the price reached its lowest point.

Shooting Star: Shooting Star bearish pattern is the opposite of the bullish pattern Hammer. Called Shooting Star for the market mood that occurs can be likened to the stars in the sky is shot down, and has the connotation of the night, dark. Shooting Star candle has a long upper wick, the candles are rather short, where the current share price is not too much different from opening to closing. During the trading session, stock prices push buyers to achieve the highest value and serve it with the seller to sell as much as possible so that the stock price lower back pressed to the point. This pattern is also related to a reversal of price trends and often follows the trend of price increase is quite long.

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