Glossary
Candlestick
A price bar showing the open, high, low and close for a period — the basic unit of chart reading.
Candlestick, explained
A candlestick summarises one time period of trading. The body spans the open and close, while the thin wicks (or shadows) mark the high and low. A close above the open is usually drawn bullish, below it bearish.
The shape tells a story: a long body shows conviction, while long wicks show rejection — price pushed to an extreme and was forced back. That rejection is precisely what reveals liquidity sweeps and reactions at key levels, which is why a single wick at the right place can carry more information than ten candles in the middle of a range.
Timeframe changes what a candle means. One daily candle is built from twenty-four hourly candles, so a tidy daily rejection wick can hide a messy intraday battle. Reading the same moment on a lower timeframe often shows the sweep and reversal that the higher-timeframe candle only summarises.
Rather than memorising dozens of named patterns, skilled traders read candlesticks in context — what a wick or strong close means at support, at an order block, or after a sweep is far more useful than the pattern's name. A 'pin bar' in the middle of nowhere is noise; the same candle rejecting a key level is a signal.
On the desk we use candlesticks as confirmation rather than standalone signals. A strong displaced close out of an order block, or a long rejection wick where we expected a sweep, confirms the level is doing its job — the candle is evidence for the level, not a reason to trade on its own.
Frequently asked questions
- What do the wicks on a candlestick mean?
- Wicks mark the high and low reached during the period. A long wick shows price was pushed to an extreme and rejected, which at a key level often signals a liquidity sweep or a strong reaction.
- Do I need to memorise candlestick patterns?
- Not dozens of them. It is far more useful to read candles in context — what a strong close or long wick means at support, an order block, or after a sweep — than to name patterns. Location matters more than the pattern.
Related terms
Displacement
A strong, decisive move that signals real intent — the engine behind order blocks and fair value gaps.
ReadLiquidity Sweep
A sharp push past a high or low that triggers resting stops before price reverses — also called a stop hunt.
ReadSupport & Resistance
Price levels where buying or selling has repeatedly stepped in — floors and ceilings on the chart.
ReadOrder Block
The last opposing candle before a strong, displaced move — a zone where institutions absorbed flow.
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