The candlestick is probably the first tool that every trader learns, and it is still one of the most useful: it condenses the opening, maximum, minimum and closing of a period into a single figure. Those who know how to read them understand the conversation that price has day by day with buyers and sellers.
What is a candle and what does each part mean
In a candlestick there are three elements: the body, which goes from opening to closing; the upper wick, which marks the maximum of the period; and the lower wick, which marks the minimum. If the close is above the open, the candle is bullish; if it is below, bearish.
The body size communicates conviction: a large body implies that buyers or sellers dominated the entire period. The length of the wicks communicates rejection: long wicks on both sides reveal that there was pressure in both directions and that, in the end, no one could prevail.
In TradingView you can change the color mapping (green/red or white/black) from Settings · Charts, and toggle the candles on or off depending on the style you prefer. The important thing is not the colour itself, but to always respect the same criteria.
The 10 Most Reliable Japanese Candlesticks
| Sailing | What it is | “What are you suggesting?” |
|---|---|---|
| Martillo (hammer) | Small body at the top and long lower wick. | Rejection of lows: possible bullish rebound, especially after a fall. |
| Hanging man | Same shape as the hammer, but it appears after a climb. | Possible bullish exhaustion. |
| Doji | Minimum body: almost equal opening and closing. | Total indecision between buyers and sellers. |
| Bullish envelope | Green candle whose body completely envelops the previous red one. | Change of control towards buyers. |
| Bearish Surround | Red candle that engulfs the body of the previous green one. | Change of control towards sellers. |
| Estrella fugaz (shooting star) | Small body down and very long upper wick. | Rejection of highs: possible bearish turn. |
| Hanging man (inverted hammer) | Same shape as the shooting star, after a fall. | Possible change to bullish. |
| Vacuum body (marubozu) | Wickless candle: maximum conviction. | Strong momentum in the direction of the body. |
| Peonza (spinning top) | Small body with medium wicks. | Pause: The market is deciding where to go. |
| Trium of Soldiers | Three green candles in a row with higher and higher closures. | Sustained buying pressure. |
How to read candlesticks: the first thing to look at
Do not read an isolated candle: inside a sequence. A single candle says little; what matters is how it reacts to the context: does it appear after a long rise or after a fall? Do you support a support or reject a resistance? Does it match volume?
- Define context: trend, range, or turn. An identical candle means something different in each case.
- Look at the body: big = conviction; small = doubt.
- Look at the wicks of the last stretch: rejection is the most authentic signal left by the price.
- Match: the candle is worth much more if it appears on a support, a liquidity zone or after a divergence.
- Wait for confirmation: the following candle that respects the closing of the signal drastically reduces false readings.
The most powerful candles are those that appear in decision zones: supports, resistances, order blocks or volatility extremes. A rejection candle without context is just noise.
TradingView Candlesticks and their Relationship to Technical Analysis
In TradingView you can draw candle patterns with small Pine Script features (e.g. detecting hammers and dojis) and alert you when they appear. The All possible indicator integrates in a single chart the reading of structure, supports and resistances, liquidity zones and chart patterns, so that the candles of your chart are always read on a clear context.
An all-in-one indicator with structure, S/R, liquidity, divergences, patterns and 33 alerts. 10€, one-time payment.
Frequently asked questions
What does a candle with very long wicks mean?
It means there was rejection - the price tested extreme levels and came back. If the long wick is lower, sellers could not hold the lows; if it is higher, buyers could not hold the highs.
Are candlesticks reliable on their own?
They are a tool, not a guarantee. Gaining reliability requires context: supports, resistances, structure and volume. An isolated candle is never enough to make a decision.
What is the difference between candle and bar?
The bar shows the same four prices (OHLC) with no visual body; the candle draws the body between opening and closing, making it easy to read the conviction of buyers and sellers at a glance.
What is the best Japanese candle for beginners?
The hammer and the doji are the easiest to identify. The hammer suggests rejection of minimums; the doji, indecision. Both are the classic starting point.