Candlestick charts, invented in Japan in the 19th century, are a visual representation of stock or security prices that provide specific information about trading highs and lows during market days or other time periods. A white candle indicates that the price went up during the trading period, and candlestick charts help with technical analysis to determine the soundness of an investment.
In the financial world, a white candle is completely symbolic. It is part of a visual representation of stock or security prices called candlestick charts. Candlestick charts provide specific information about trading highs and lows during market days or other time periods.
Candlestick charts are said to have been invented in Japan in the 19th century. Over time it became a common financial tracking tool in the United States and around the world. The candlestick board still has various shapes and forms named in Japanese. Many of the auxiliary patterns on a candlestick chart reveal a lot about how a stock or security trades over time.
On a candlestick chart, a “candlestick” shows the difference between the opening and closing prices of a security during a trading day or other time period. If the open price was lower than the close price, the candle will be white. That means that the price went up, and not down, during the trading period. If, on the other hand, the opening price was higher than the closing price, and the price fell during the trading period, the candle will be black. For those who invested in a stock hoping for growth, a series of white candlestick patterns is desirable.
The candlesticks that represent trading periods on the candlestick chart are placed in a horizontal pattern that forms a combination of a bar chart and a plotted line. The candlestick chart also has other useful features, such as a “wick” that shows if there were prices higher or lower than the difference in the open and close price. If so, that peripheral price will be represented by a thin line coming out of the top or bottom of the black or white candlestick.
A candlestick chart helps with what financial experts call “technical analysis,” which involves looking at a security’s past prices as well as other information to determine how sound an investment it is. The visual aid offered by the candlestick chart helps in making decisions about stocks and other investments. The daily candlestick display can show how interest in a stock is rising or falling. In market terms for a specific stock, professionals refer to white candlestick patterns and interest building as “bullish,” and declining interest as “bearish.” In general, candlestick charts can be an essential part of getting a quick view of what a stock or asset has done in the past.
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