How to Read a Candlestick Chart
Open, high, low, close: a guide to the chart traders use most, and the limits of chart patterns.
- By
- Lynktor Editorial Team
- Reviewed by
- Lynktor Research Desk
- Updated
One candle, four prices
Each candlestick covers one period, such as a day. It shows four prices:
- Open: the first trade of the period.
- Close: the last trade.
- High and low: the extremes, shown by thin lines called wicks or shadows.
The thick body spans the open and the close. When the close is above the open, the candle is usually drawn green or hollow. When the close is below the open, it is red or filled.
What the shape suggests
A long body shows strong movement in one direction. Long wicks show prices that were reached but rejected. A tiny body with long wicks, often called a doji, shows indecision.
A candle tells you what happened, not what will happen next.
Use with care
Patterns are probabilities, not signals that guarantee an outcome. Many traders combine candles with volume, trend, and support and resistance levels, and always size positions so that being wrong is affordable.
Try it
Pick a stock on our markets page and switch between ranges. Notice how a single daily move looks very different on a five-year chart.