Zero-Based Candlestick Learning | 1 From Price to Candlesticks
Trends have patterns, understand the language of price;
Buy and sell signals, say goodbye to emotional trading .
I. What is a Candlestick?
Today, let's learn together the most fundamental element of technical analysis—candlesticks . Candlesticks are the most common price marking method today.
First, let's look at how prices move in the market during a day.
Without candlestick charting, the price of an investment product looks like this—countless prices connected together forming an seemingly irregular curve. Looks a bit messy, doesn't it?
Next, let's do some simple technical analysis processing and mark the key data: opening price, closing price, highest price, lowest price. We filter out the complex price changes and plot them as a line chart. As shown in the figure, isn't this much clearer?
II. What is a Candlestick Chart?
Can we represent it more simply? Of course, let's learn about candlestick charts. As shown in the figure, we process it by aligning the opening price, closing price, lowest price, and highest price on a vertical line. The area between the opening and closing prices forms the candlestick body, which we represent with a thicker line. The areas from the body to the highest and lowest prices are represented with thinner lines, forming the upper shadow and lower shadow respectively.
When the closing price is lower than the opening price, we mark the body in red, indicating that the price declined during that period, usually called a bearish candle. When the closing price is higher than the opening price, we mark the body in green, indicating that the price rose during that period, usually called a bullish candle. (Of course, some markets use opposite colors to mark candlestick rises and falls.)
When we connect each day's candlesticks together, we get the familiar candlestick chart pattern. Each red or green candlestick in the chart represents one day's price change data. If one day's price movement can be represented by one candlestick, then what about one minute, one hour, or one week?
Based on different time ranges for tracking price changes, we divide candlesticks into different periods. This is what multiple one-minute candlesticks connected together looks like, and this is what multiple "weekly candlesticks " connected together looks like. Period division is very flexible—can be a few minutes, a few hours, a few days, a few weeks, or even several months.
What role do candlesticks play in investment market analysis? When specific candlestick patterns or specific candlestick combinations appear, there is a high probability of specific price trends occurring. Because price reflects all market behavior, history amazingly repeats itself.
In future articles, we'll share methods for predicting future price rises and falls by observing regular candlestick arrangements.
Disclaimer
This article may contain product-related content not applicable to your region. This article is intended to provide general information only and does not take responsibility for any factual errors or omissions therein. This article represents only the author's personal views and does not represent OKX 's views. This article is not intended to provide any of the following advice, including but not limited to: (i) investment advice or investment recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; or (iii) financial, accounting, legal, or tax advice. Holding digital assets (including stablecoins) involves high risk, may fluctuate significantly, and may even become worthless. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. For questions about your specific situation, please consult your legal/tax/investment professional. The information appearing in this article (including market data and statistics, if any) is for general reference only. Although we have taken all reasonable precautions in preparing these data and charts, we assume no responsibility for any factual errors or omissions expressed herein. © 2025 OKX. This article may be reproduced or distributed in full, or excerpts of 100 words or less from this article may be used, provided such use is non-commercial. Any reproduction or distribution of the entire article must also prominently state: "© 2025 OKX, used with permission." Permitted excerpts must cite the article name and include attribution, for example "Article Name, [Author Name (if applicable)], © 2025 OKX". Some content may be generated or assisted by artificial intelligence (AI) tools. Derivative works or other uses of this article are not permitted.
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