How to Read Candlestick Charts – The Language of Price Action

Overview:Candlesticks are the heartbeat of price action. They show you exactly what buyers and sellers are doing.

What is a Candlestick?

Each candlestick shows 4 key data points:- Open- High- Low- Close

Basic Candlestick Structure:

A candlestick shows the battle between buyers and sellers – each part tells a story.

Types of Candlestick Patterns

These patterns provide clues about potential price reversals or continuations.

Common Candlestick Patterns :

Most common candlestick patterns traders use to spot market reversals or trend continuations.

Pattern Summary Table:

Pattern Name	Meaning
Hammer	Reversal from downtrend (bullish)
Shooting Star	Reversal from uptrend (bearish)
Doji	Indecision in market
Bullish Engulfing	Strong buying pressure
Bearish Engulfing	Strong selling pressure

See it in Action

Real Candlestick Pattern Example on Chart:

Example: A bullish engulfing candle formed at support zone followed by an uptrend.

Pro Tip

- Always read candlesticks in context (trend, support/resistance).- Don’t trade a pattern blindly without confirmation.