Posted by forex at 2:34 AM
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1. Spread out your Japanese candlestick chart on a table. Make sure you can see all aspects of the chart.
2. Note the bars on the chart. The bars are called candlesticks. The hollow or filled portion of the candlestick is called the body.
3. Note the hollow and filled candlesticks. If the stock closes higher than its opening price, the candlestick is hollow. If the stock closes lower than its opening price, the candlestick is filled.
4. Find the high and closing values of your stock on a hollow candlestick for a designated period of time. The period of time is listed on the bottom of the chart. The long, thin lines above and below the body are called shadows. The shadow above the body tracks the high and closing range of your stock. The top of the shadow that is farthest from the body shows the high value. The bottom of the shadow that is close to the body shows the closing value. All stock values in the chart are listed on the right.
5. Find the opening and low values of your stock on a hollow candlestick for a designated period of time. The period of time is listed on the bottom of the chart. The shadow below the hollow body tracks the opening and low range of your stock. The top of the shadow that is closest to the body shows the closing value. The bottom of the shadow that is farthest from the body shows the low value. All stock values in the chart are listed on the right.
6. Find the high and opening values of your stock on a filled candlestick for a designated period of time. The period of time is listed on the bottom of the chart. The shadow above the body tracks the high and opening range of your stock. The top of the shadow that is farthest from the body shows the high value. The bottom of the shadow that is close to the body shows the opening value. All stock values in the chart are listed on the right.
7. Find the closing and low values of your stock on a filled candlestick for a designated period of time. The period of time is listed on the bottom of the chart. The shadow below the filled body tracks the closing and low range of your stock. The top of the shadow, close to the body, shows the close value. The bottom of the shadow, farthest from the body, shows the low value of your stock. All stock values in the chart are listed on the right.
8. Decipher the basic stock trends on the chart. Hollow candlesticks, where the closing is greater than the opening, indicate buying pressure. Filled candlesticks, where the closing is less than the opening, indicate selling pressure. If the chart shows mostly hollow candlesticks with the closing greater than the opening, you should buy the stock. If the chart shows mostly filled candlesticks with the closing less than the opening, you should sell the stock.