The four prices of a candle – trading math lesson

Charts in this lesson are generated. They are not real market data and predict nothing.

A candle summarises every trade in one period with four prices. The open is the first price, the close the last, the high and low the extremes in between. Nothing else is in the candle: not the order of the moves, not the path.

The shaded candle opened at 95.23 and closed at 95.76, above its open, so it is an up candle (green).

This candle closed near its high. Will the next six candles close higher or lower?

Up and down candles

Close above open: an up candle, drawn green. Close below open: a down candle, drawn red. The colour says nothing about the previous candle; a green candle can close below yesterday’s close if it opened lower.

Open 100.00High 104.00Low 97.00Close 102.50

Range 7.00 · body 2.50 (36%) · upper wick 1.50 (21%) · lower wick 3.00 (43%) · up candle (close above open)

No named single-candle shape.

Worked example

open 95.23 · high 95.77 · low 95.21 · close 95.76

range = high − low = 95.77 − 95.21 = 0.56; close − open = 0.53 → up candle

A candle opens at 50.00, trades up to 51.20, down to 49.40, and closes at 49.90. What is it?

Simulator round · Find the biggest part of the candle

Generated chart. It is not real market data and predicts nothing.