Bullish and Bearish Price Action — Forecast The Next Market Move

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Markets are a mix between psychology, supply, demand, randomness, and anything in-between. Historical observations are most likely what we have to try to predict what may come next. This article discusses a simple (and old) technique that signal a continuation of a trend.

Introduction to Candlesticks

Candlesticks are a fundamental tool used in technical analysis to analyze and interpret price movements in financial markets, such as stocks, currencies, commodities, and more. They provide valuable insights into the psychology of market participants and help traders and investors make informed decisions.

A candlestick consists of four main components: the open, close, high, and low prices for a specific time period, such as a day, week, or month. These components are represented graphically as a rectangular shape with a thin vertical line on top and/or bottom, resembling a candlestick. The body of the candlestick represents the price range between the open and close prices, while the vertical lines, known as “wicks” or “shadows,” extend above and below the body to show the high and low prices during that period.