So what are candlesticks in this video I'm gonna go over basics of reading
candlesticks and how to use them to read a stock chart hey what's going on on
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candlesticks represent price change over a certain duration candlesticks can
represent anywhere between a minute worth of data or a month's worth of data
so for a stock you can have a candlestick represent what happened to
the price change of that stock over the last let's say 10 minutes there are two
types of candlesticks bullish or bearish bullish meaning that the price increased
over that time period and bearish meaning the price decreased over that
time period this candle right here is a bullish candle and that is represented
by the fact that the color of the body is green this represents that the price
increased over the duration that that candle represents so if this was an hour
long candle it would mean that the price increased over that hour to go over all
the different parts of a candle you have the three parts of it the body and the
two wicks the body shows you where the open and closed were based on the color
of the body and the wicks show you where the high and the low were instead of
knowing the closing price of that timeframe that a normal graph would have
candlesticks allow you to see a lot more insight into what happened over that
timeframe instead of just knowing where it opened and closed you can actually
tell here the stock opened up around this price let's say 65 and then trade
it all the way down to 64 and throughout the timeframe traded all
the way as high as the high let's say 67 and then traded back down a little bit
enclosed at the closing price which let's just say is 66 and based on that
you can tell that the opening price was lower than the closing price which would
make this a bullish candle and then it also had those high and lows this can
give you a lot of insight into the psychology sentiment or just overall
strength or weakness of a current stock so the other candle being a bearish
candle just represents the opposite of a bullish candle that the price decreased
over that time period and as you can see on this candle everything is the exact
same except for the fact that the open is at the top of the candle body and the
close is at the bottom of the body just to give a quick representation of what
could have happened over the time period of this bearish candle is the price
could have opened up here and traded up to the high and then started to trend it
down pretty strong throughout this candle and then hit the low of the
candle and then began to go up a little bit into the closing price where it
would have switched into a new candle but this is what the price could have
looked like throughout this candle now let's start putting these together so we
can look at reading an actual stock chart and when you actually look at a
stock chart the candlesticks are not all the same they can have a very small
bodies and huge wicks or no wicks and huge bodies there can be any number type
of candles it just depends on what happened with the price action
throughout that candle so on this stock we can see that the price opened up down
here because this is green candles so it's a bullish candle
and that there's a tiny little wick at the bottom here so the price traded a
tiny bit down and then throughout the day it it traded all the way up to this
high and then eventually closed here and candles don't necessarily close and then
the next candle opens at that exact price the next candle can open actually
at whatever price someone wants to buy it at or sell it at and so let's say
this candle actually opened at this lower price all the way down here but
because in the end it closed all the way up here it is still a bullish candle
making it a green candle and we can see it had two decent-sized wicks giving it
those low and high points and then it eventually closed up here and this next
candle opened up at the exact same price as the other candle but is actually a
bearish candle because the price ended up closing lower than the opening price
and as you can see with this candle there's actually no bottom link there's
only a little higher wick where the price tried to push up and then
eventually sold all the way off to this closing price and then with this last
candle the price opened up actually lower than the closing price of the last
candle and this is called it it gapped lower because you can see that there is
this little gap between the closing price and the opening price of the next
candle and we can see this is another bearish candle because the close was all
the way down here at the bottom indicated by that red body color and
again this one had decent sized wicks on the high and the low side but the candle
still ended up closing a lower now to look at an actual stock chart here we
have a daily stock chart of Amazon and so that means each of these candles
represents a whole trading day's worth of data and so over these 14 days you
can see that Amazon went from down here from around 1,400 and kind of went
through this wave-like pattern and eventually closed up at 1500
but because the data is represented by daily candles we can take a deeper dive
into what happened with the price over those 14 days starting down here with
this first candle you can see that the price had a really strong day it opened
and then closed almost $40 higher with pretty small wicks and then the next day
it actually gapped all the way up to this price and closed lower with a huge
wick down here and this actually even though the price closed higher than the
previous day this is still forming a bullish candle right here just because
that the price opened higher and then closed lower throughout the day even
though compared to the day before the price is actually still higher and then
this next day the price ended up gapping lower and opening up at this price here
and then closing lower as well making another bearish candle and then the
price ended up open here for the next day and then trading really high and
then closing down here so I'm not going to go through and analyze each of these
candlesticks maybe this is a good place to pause the video and just really look
at each day and what happened and try and practice just reading the candles so
you can understand the overall flow of the stock chart and then just try and
find a platform just on the web you maybe look up different stock prices
and just start looking over stock charts and get better just at looking at these
a good website would be training Viacom it's just a free website where you can
go on and just type in any stock and it will come up with the stock chart and
you will be able to review and start getting better at reading stock charts
and candlesticks hey thanks for turning on this video if you want to learn more
about candlestick charts and learn some candlestick patterns make sure to check
out this video right here and if you just want more technical analysis videos
make sure to subscribe to the channel if you have any comments or questions make
sure to ask them in the comments below and I hope to see you in the next video