Japanese candles: Long bodies against the short

In general the candle body is longer then is especially intensive pressure of buyers or sellers. And on the contrary, short candles specify in small price movements and represent consolidation.

Long white candles show strong pressure of buyers. The longer is a white candle; the closing price is above opening price. It shows that the prices have considerably promoted from opening before closing and buyers were aggressive. Though long white candles in itself bull, much depends on their position in frameworks of wider technical picture.

After long decrease, the long white candle can designate a potential turning point or support level. If purchasing becomes too aggressive after long increase it can lead to extremely bull movement.

Long black candles show strong pressure of sellers. The more long the black candle, the closing price is below opening price. It shows that the prices considerably decreased after opening and sellers were aggressive. After long increase, the long black candle can foretell a turning point or specify in the future level of resistance. After long decrease the long black candle can specify in a panic or capitulation.

Even more powerful long candles are brothers of marabous, black and white. Marabous have no top or bottom both the maximum and a minimum are presented by opening and closing. White marabous are formed, when opening price equals to a minimum, and closing equals to a maximum. It specifies that buyers managed price movement from the beginning and till the end of trade. Black marabous are formed, when opening price equals to a maximum, and closing to a minimum. It shows that sellers managed price activity from the first and before last trade.

Long shades against the short

The top and bottom shades on candles can give the valuable information on trading session. The top shades represent a sessional maximum, and the bottom shades represent a sessional minimum. Candles with short shades show that the most part of trading activity has been limited by close opening prices and closings. Candles with long shades show that trade was extended well by opening prices and closing.

Candles with a long top shade and a short bottom shade specify that buyers dominated during session and offered more heavy prices. However, sellers have beaten down the prices below their maxima later and weak closing forms a long top shade. On the contrary, candles with long bottom shades and short top shades show that sellers dominated during trading session and have resulted the prices downwards. However, buyers later by the session end have pushed out the price above, and strong closing has generated a long bottom shade.

Candles with a long top shade, a long bottom shade, and a small body name tops. While one long shade represents change, tops show failure to decide. The small body (not very well empty or filled) shows small movement from opening price to closing price, and shades show, as bulls and bears were active during session. Even thus that session has opened and closed with little change, the prices moved much more above and more low during session. Neither buyers, nor sellers could get advantage and, in result, the status quo has been recovered.

People who took the decision to participate in forex trading should start from learning the basics of this market to make sure you do not have problems with this industry.

There is another option – you can hire professional traders to managed your trading account – read more about forex investment here. Also make sure to look for the knowledge in a good forex book.