Glossary · Defined term
Candlestick chart
A candlestick chart shows each period's open, high, low, and close prices in one candle-shaped bar. See how to read the body, wicks, and patterns.
Last updated Oct 2, 2026
What it means
A candlestick chart displays price action as a series of candles, each summarizing one period's open, high, low, and close. The thick body spans the open to the close, while the thin wicks stretch to the period's high and low. Color or shading shows direction: one color marks periods that closed higher than they opened, another marks periods that closed lower.
Because each candle packs four data points into one shape, the chart reveals the battle between buyers and sellers at a glance. A long body with short wicks shows decisive movement in one direction, while a small body with long wicks shows indecision, with prices pushed far in both directions before settling near the open.
Technical traders read patterns in sequences of candles for clues about sentiment shifts. A doji, where open and close are nearly identical, suggests a tug of war. A hammer after a decline hints that buyers stepped in. Candlesticks work best alongside volume and other context, since any single pattern can fail.
An example
For illustration, a daily candle opens at $50, dips to $49, rallies to $55, and closes at $54. The tall body from $50 to $54 with wicks to $49 and $55 tells you buyers dominated the session despite an early dip.