A single candle on a chart holds one day of price movement. We start with the numbers inside a candle, then look at how candles with special shapes are commonly read in the market.
Five numbers in one candle
| Name | Meaning |
|---|---|
| Open | The first traded price of the day |
| High | The highest price of the day |
| Low | The lowest price of the day |
| Close | The last traded price of the day |
| Volume | The number of shares traded that day |
Every candle in this game is one day: a daily candle. In a match a new candle appears every 0.5 seconds, but each of those candles is a real day in the market.
Drawing a candle from four prices
A candle is drawn from the four prices alone. Volume is drawn separately from the candles, as bars in an indicator panel.
| Part | Spans |
|---|---|
| Body | From the open to the close |
| Upper wick | From the end of the body to the high |
| Lower wick | From the end of the body to the low |
Bullish and bearish candles
| Name | Condition | Color on this screen |
|---|---|---|
| Bullish | The close is above the open | Green |
| Bearish | The close is below the open | Red |
Even on a day the price fell, the candle is green if the close is above the open. If the open was −$10 from the day before and the close was −$5, it is a bullish candle and it is green. Likewise, even on a day the price rose, the candle is red if the close is below the open. A candle whose open equals its close is drawn in green in the game.
Candles with special shapes
Some shapes have their own names and are commonly read in a certain way. They are not sure signals, though. The same shape can mean different things depending on whether it appears at the end of a rise or at the end of a fall.
In each real chart, the candle marked with a yellow vertical line is the shape. The shaded stretch is the move just before that candle (rising or falling). Drag the chart sideways with a finger or the mouse to move it, and pinch with two fingers to zoom in. With a keyboard, click the chart, then use ←/→ to move and +/− to zoom.
Bullish Marubozu
Data: Open ≈ low, close ≈ high: no wicks or almost none, and a long body.
Buyers pushed all day long. Commonly read as strong buying pressure.
Charts by TradingView Lightweight Charts™
30 candles. Candle 25 is a long bullish candle with almost no wicks. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — Equip the “Bullish Marubozu” weapon and candles like this get a marking. That is when each wick is at most 10% of the whole candle and the body is longer than 1.5 times the average body of the last 10 candles.
Bearish Marubozu
Data: Open ≈ high, close ≈ low: no wicks or almost none, and a long body.
Sellers pushed all day long. Commonly read as strong selling pressure.
Charts by TradingView Lightweight Charts™
30 candles. Candle 25 is a long bearish candle with almost no wicks. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — Equip the “Bearish Marubozu” weapon and candles like this get a marking. The rule is the same as for Bullish Marubozu, in the opposite direction.
Doji
Data: Open = close: no body or a very thin one, with wicks on both sides.
A day when buyers and sellers were evenly matched and the market hesitated. At the tail end of a rise or a fall, it is taken as a warning that the direction may change.
Charts by TradingView Lightweight Charts™
30 candles. Candle 25 is a doji with a very thin body. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — Equip the “Doji” weapon and candles whose body is at most 5% of the whole candle get a marking.
Dragonfly doji
Data: Open = close = high (or nearly so): no upper wick or almost none, only a long lower wick.
The price fell a long way during the day and came all the way back to the open. At the bottom of a fall, it is commonly read as a rebound signal.
Charts by TradingView Lightweight Charts™
40 candles. Candles 21 to 31 fall, then candle 32 is a dragonfly doji. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — No weapon looks for the dragonfly alone. Its body is almost nothing, so the “Doji” weapon marks this candle too, and because only the lower wick is long, the “Hammer” (after a fall) or “Hanging Man” (after a rise) weapon marks it as well.
Gravestone doji
Data: Open = close = low (or nearly so): no lower wick or almost none, only a long upper wick.
The price rose a long way during the day and was pushed all the way back to the open. At the top of a rise, it is commonly read as a warning of a turn down.
Charts by TradingView Lightweight Charts™
40 candles. Candles 21 to 31 rise, then candle 32 is a gravestone doji. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — No weapon looks for the gravestone alone. Its body is almost nothing, so the “Doji” weapon marks this candle too, and because only the upper wick is long, the “Inverted Hammer” (after a fall) or “Shooting Star” (after a rise) weapon marks it as well.
Four-price doji
Data: Open = high = low = close: all four prices are equal, so it shows as a single horizontal line.
A day with almost no trading, or with the price stuck at one level. This candle alone is hard to read.
Charts by TradingView Lightweight Charts™
30 candles. Candle 25 has four equal prices and is a single horizontal line. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — The candle has zero length, so even the “Doji” weapon does not mark it.
Same shape, different place, different meaning
Each of the next two pairs has exactly the same shape. The only difference is whether it appears at the end of a fall (a bottom) or at the end of a rise (a top), and that decides its name and meaning.
Hammer ↔ Hanging Man
Data: The lower wick is at least 2 times the body, and there is no upper wick or almost none.
Hammer · At the end of a fall, at a bottom
The price was pushed far down and came back, so it is commonly read as a candidate for a turn up.
Charts by TradingView Lightweight Charts™
40 candles. Candles 21 to 31 fall, then candle 32 is a hammer. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
Hanging Man · At the end of a rise, at a top
A sign that the price was pushed far down during the day in the middle of a rise, commonly read as a warning of a fall.
Charts by TradingView Lightweight Charts™
40 candles. Candles 21 to 31 rise, then candle 32 is a hanging man. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — The game has separate “Hammer” and “Hanging Man” weapons. Both only look at candles whose upper wick is at most 15% of the whole candle. If the close is below the average close of the last 10 candles, it counts as a fall (→ Hammer); if above, as a rise (→ Hanging Man).
Inverted Hammer ↔ Shooting Star
Data: The upper wick is at least 2 times the body, and there is no lower wick or almost none.
Inverted Hammer · At the end of a fall, at a bottom
A sign that buyers made one strong push up, commonly read as a candidate for a turn up.
Charts by TradingView Lightweight Charts™
40 candles. Candles 21 to 31 fall, then candle 32 is an inverted hammer. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
Shooting Star · At the end of a rise, at a top
A sign that the price climbed high and was pushed back down, commonly read as a signal of a turn down.
Charts by TradingView Lightweight Charts™
40 candles. Candles 21 to 31 rise, then candle 32 is a shooting star. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
In the game — The game has separate “Inverted Hammer” and “Shooting Star” weapons. Both only look at candles whose lower wick is at most 15% of the whole candle. If the close is below the average close of the last 10 candles, it is an Inverted Hammer; if above, a Shooting Star.
Summary
- One candle is one day. The body shows the open and the close; the wicks show the high and the low.
- A special shape is a clue that it is “commonly read this way”, not an answer.
- The same shape can mean different things depending on where it appears. That is why the next lesson covers reading the trend.