Sexy Bodies
Just like
humans, candlesticks have different body sizes. And when it comes to forex
trading, there's nothing naughtier than checking out the bodies of
candlesticks!
Long
bodies indicate strong buying or selling. The longer the body is, the more
intense the buying or selling pressure. This means that either buyers or
sellers were stronger and took control.
Short
bodies imply very little buying or-selling activity. In street forex lingo,
bulls mean buyers and bears mean sellers.
Long
white candlesticks show strong buying pressure. The longer the white
candlestick, the further the close is above the open. This indicates that
prices increased considerably from open to close and buyers were aggressive. In
other words, the bulls are kicking the bears' butts big time!
Long
black (filled) candlesticks show strong selling pressure. The longer the black
candlestick, the further the close is below the open. This indicates that
prices fell a great deal from the open and sellers were aggressive. In other
words, the bears were grabbing the bulls by their horns and body-slamming them.
Mysterious Shadows
The upper
and lower shadows on candlesticks provide important clues about the trading
session.
Upper
shadows signify the session high. Lower shadows signify the session low.
Candlesticks
with long shadows show that trading action occurred well past the open and
close.
Candlesticks
with short shadows indicate that most of the trading action was confined near
the open and close.
If a candlestick has a long
upper shadow and short lower shadow, this means that buyers
flexed their muscles and bid prices higher, but for one reason or another,
sellers came in and drove prices back down to end the session back near its
open price.
If a candlestick has a long
lower shadow and short upper shadow, this means that sellers
flashed their washboard abs and forced price lower, but for one reason or
another, buyers came in and drove prices back up to end the session back near
its open price.
