Chandeliers have grown considerably in popularity over the past decade and a little and originally a guy named Steve Nison introduced them to the western world. While the scope of candlestick charts is extremely wide and varied, we are going to focus on what a solid candlestick means when we look at the charts.

The first thing you will notice about candles is that you can have open and solid candles and usually you also have candles of different colors, namely red and green.

An open candlestick

An open candle simply means that the closing price of the day closed higher than where it opened, resulting in an increase in the share price between the open and the close.

A solid candlestick

A solid candle means that the closing price of the day closed below where it opened, resulting in a drop in the share price between the open and the close.

A red candlestick

A red candle generally refers to a bearish day relative to the previous trading day. For example, the previous day’s close was $ 25 and today it closes at $ 24, resulting in a red candle.

A candlestick of greed

A green candle generally refers to a positive day relative to the previous trading day. For example, the stock you are trading could have closed at $ 30 yesterday and closed at $ 31 today resulting in a green candle.

An open red candlestick

An open red candle may be new to most people, as your charting program may not have the functionality or depth to display these candles. An open red candle simply means that today’s close price is lower than yesterday’s close, but today’s close price is higher than that of the day’s open.

A solid green candlestick

A solid green candle shows us that today’s closing price is higher than yesterday’s closing price, but today’s closing price is lower than today’s opening price. So as you can see, candles can paint a very impressive and graphic picture and once you get used to them, you can see some advanced patterns to take advantage of.