Candlestick Chart (Up Candle / Down Candle)
A chart that shows a day's (or a set period's) open, close, high, and low as a single candle shape — up candle when it rises, down candle when it falls.
Body = between the open and the close / Upper and lower wicks = the high and low of that period
A long up candle is read as buying pressure being strong during that period, and a long down candle as selling pressure being strong.
In plain terms
It packs into one candle where the price started during the day (open), where it ended (close), and how high and low it went (high and low). It is drawn with a bar (body) and wicks above and below.
If it ends higher than where it started, it is an "up candle"; if it ends lower, a "down candle." (※ On US charts, up is usually green; in Korea and Japan the colors are reversed, with up shown in red.)
What it tells you
Candles show the "tug-of-war" within a period better than a simple line chart. A long body means price was pushed hard in one direction, while long upper and lower wicks mean price went one way and was then pushed back by the opposing force.
One thing worth noting here. A candle records "what happened," not "what comes next." Pattern names like hammer or doji are mostly interpretations people attached after the fact.
Formula
Body = between the open and the close / Upper and lower wicks = the high and low of that period Close > Open → up candle (green in the US; red in Korea) · Close < Open → down candle
What high or low means
A long up candle is read as buying pressure being strong during that period, and a long down candle as selling pressure being strong.
A long upper wick is sometimes read as price rising and then being pushed back down (a sign selling pressure was strong), and a long lower wick as price falling and then being lifted back up (a sign buying pressure held it up).
Candle patterns are an area where the "only the hits stick in memory" illusion (hindsight bias) is especially strong. With dozens of patterns out there, only the cases that worked tend to be remembered, so judging by a single pattern alone is risky. Even the same shape can mean the opposite depending on where in a trend it appears.
It is easy to read too much into the shape of a single candle. Only by looking at the context of volume and trend together can you tell whether that shape actually means anything.
Color conventions differ by market — in the US, rising candles are usually green and falling ones red, while in some Asian markets the colors are reversed. Judging up or down by color alone can be confusing. Also, this is a tool that looks only at price movement, so it says nothing about a company's value, and by itself it is not a signal to buy or sell.
The candlestick chart is said to have originated from the way 18th-century Japanese rice traders recorded price movements. The story that a great merchant named Munehisa Homma systematized it is well known.
A single candle holds not only the opening and closing prices of that period but also the "wicks" extending up and down, capturing at a glance the traces of the tug-of-war between buyers and sellers during the session. A long upper wick, for example, means price rose during the session and then was pushed back. Because it shows "what happened inside" — something a simple line chart misses — a tool from centuries ago has survived to this day.
Metrics to read alongside
See it in real stocks
Search US stocks on Stocklore to see SEC-filing-based financial metrics alongside the sector benchmark.
This explanation is for information and reference only and is not a recommendation to buy or sell any security. Investment decisions and their consequences are your own.