Japanese candlesticks were invented by Munehisa Homma, a rice trader from Sakata, Japan, in the 18th century. They were used to track the price movements of rice and were later adapted to be used for trading other assets, such as stocks and forex. Traders use candlestick patterns to identify potential trend reversals or continuations and potential entry and exit points for trades. By analyzing these patterns, traders can gain valuable insights into market sentiment and make more informed trading decisions. The advantage of using candlestick patterns is that they can provide a visual representation of price movements that can be easier to interpret than traditional line charts.
Candlestick Basics
Are you candlestick-literate? The widely used candlestick chart is easy to read but also contains some less obvious but valuable
clues about momentum and reversal.
Candlesticks, Japanese - Technical Analysis from A to Z
In the 1600s, the Japanese developed a method of technical analysis to analyze the price of rice contracts. This technique is called candlestick charting. Steven Nison is credited with popularizing candlestick charting and has become recognized as the leading expert on their interpretation. I have met investors attracted to candlestick charts by their mystique - maybe they are the "long-forgotten Asian secret" to investment analysis.
Candlestick Basics
Candlesticks, Japanese - Technical Analysis from A to Z