22. What is Candlestick? Why is It the Most Popular Chart in Forex?

November 16, 2022

Candlestick is a price chart formed by Open, High, Low, and Close prices. The color od the body can represent bullish or bearish market condition. Traders use the candlestick chart to analyze possible price movement based on past patterns.

Candlestick is a type of price chart that was originally developed by a Japanese trader more than 100 years ago. It was introduced to the modern financial market by Steve Nison through his book which was published in 1991.

Each candle consists of a 'body' that sometimes has a wick or tail. It can show the market's Open, High, Low, and Close prices for a certain period of time. Interestingly, Candlestick's body is usually filled with colors that depend on the market condition. This makes it easier for traders to analyze price patterns using the candlestick chart. Below is the anatomy of bearish and bullish candlesticks.


Compared to other charts in forex trading, candlestick becomes the most well-known due to its clarity in showing market sentiments. The components of the candlestick chart (body and wick) have made it possible to form many different patterns that can be interpreted as bullish or bearish signals, reversal or continuation signals, and even breakout or pullback signals. This is certainly a more advanced function than the other popular forex charts. In that case, the line chart only shows the ups and downs of a currency pair and the bar chart doesn't have a solid body to read.


1. What Is Forex? 2. Why Does Forex Market Exist? 3. What Drives the Forex Market? 4. Why is Forex Trading Popular? 5. Can I Get Rich in Forex? 6. Are You Curious? Want to Discover More about Forex Trading? Meet Demo Acount! 7. I'm a Newbie, How to Master Forex Trading? 8. What Forex Knowledge Should I Conquer? What Are the Steps to Go Thorugh the Journey? 9. What are Software and Glossaries in Trading Forex? 10. How to Read the Forex Market? 11. How to Practice Forex Trading? 12. How to Ride on the Forex Wave? 13. How to Prepare Basic Trading Requirement? By the Demo Account? What about the MT4/MT5? 14. What is Bid-Ask Spread? 15. What is Pip? 16. What is Lot Size 17. What is Leverage in Forex Trading? 18. What is Margin? 19. When to Trade Forex? 20. What is the Most Dominant Market in Forex? How is the Characteristic? 21. What is Chart in Forex? 22. What is Candlestick? Why is It the Most Popular Chart in Forex? 23. What is Technical Analysis? 24. What is Fundamental Analysis? 25. What are MT4 Indicators and How to Use Them? 26. What is Risk in Forex? 27. What is the Psychological Effect in Forex Trading? 28. How to Compile a Strategy Template? 29. How Long Should You Practice in a Demo Account? 30. When Do I Need to Start Learning about Brokers? 31. What Exactly Does a Forex Broker Do? 32. Can I Trade Forex without Broker? 33. How Much Money Do You Need to Trade in Forex Brokers? 34. How to Choose a Good Forex Broker? 35. What is Regulation? And Why Should Regulation Exist? 36. Why Should You Choose Forex Brokers with Top-tier Regulations? 37. How to Choose Forex Brokers Based on Your Need and Where You Are From? 38. What Brokers Should You Avoid? 39. Is There Any Broker Scam in History? How Bad Is It? 40. What are the Most Popular Brokers in The World? 41. What are the Best Brokers For Entry-Level Traders? 42. What are the Best Brokers for Traders with Minimum Deposit Capabilities? 43. Which Broker Provides a Demo Account and Easy Setup? 44. Which Broker Provides Easy Registrations? 45. What and How to Deposit on Forex Brokers? 46. What and How to Withdraw from Forex Brokers?