2.3 Japanese trading candlesticks explained Video Lecture | Forex: Learn and Master Trading (English) - Business Basics

welcome back to capex forex trading comm
in this video we're going to focus on
what a candlestick
actually is so traditionally traders
used to trade using bar charts okay
which looked like this and essentially
the way that you there used to read them
is as follows so we have a vertical line
here which gives us an idea of how high
and how low the session went okay so the
top of that line is always the high of
the session and the bottom of that line
is always a low of the session now these
lines also had two horizontal lines
coming out from each side so you have
one coming out to the left there and you
have another one coming out to the right
there the lines that come out to the
left are always the opens of that
session and the ones that come out to
the right are the close of that session
okay so that is literally how they used
to read them now you can you can see
that because the right line or the right
horizontal line is above the bottom left
line that means that this session ended
up with a closed higher than the open so
it was an up day or in obsession the
line that we have next to him here you
can see that the the horizontal line on
the right is lower than the horizontal
line that comes out to the left so that
means that this session was lower on the
close than it was on the open so this
proves would be quite difficult to read
because there were single colors you've
had to really focus your eye on looking
at these horizontal lines that are
coming out to make any kind of sense of
this so the what the introduction of the
candlestick actually made everything
easier and the only thing that
realistically happened in this
transformation is that the space in
between the open and the close in the up
days and the open and the close in the
down down days will call it in so if I
just click this button and if you pay
attention to this line and this line you
will see what change occurs
okay you see if I keep flicking away
from into different mode you will see
that realistically no levels have
changed but by adopting the candlestick
you can see that the low was at the
sorry the open was at the low of the day
the session went up to this level and it
closed here and because it was a white
or a green candle in some charts that
means that the session ended up higher
or close higher than the open whereas
the session in this session so if they
closed in this session was lower than
the open and because it's a black candle
or a red candle in other charts you can
see that straight away so by simply
referencing this chart with your naked
eye you can have a much clearer picture
a lot quicker than if you would if you
looked at a bar chart okay so that is
what a candlestick is it's just an easy
way for us to view our charts so we will
see you for the next lesson