Candlesticks in Crypto Trading

Charts and technical analysis can be illustrated in various ways ranging from line charts to point and figure charts. A common format used in cryptocurrency is candlesticks. Let’s take a look at some common shapes and structures and how to analyze them when looking at price action.

Candlestick Components

Example: Upper left corner of the chart shows the number values of each component which match below.

Certain candlestick shapes help to dictate future price action. The key is to analyze the body and the wicks of the candles to gauge if buyers or sellers are in control.

Bodies and Wicks

The longer the body is, the more prominent the buying or selling is. Conversely, short candlesticks indicate little price movement and illustrate consolidation or sometimes indecision.

Bodies and Wicks

The longer the body is, the more prominent the buying or selling is. Conversely, short candlesticks indicate little price movement and illustrate consolidation or sometimes indecision.

1. Long white candlesticks indicate that the buyers controlled the trading that session.

2. Long black candlesticks indicate that the sellers controlled the trading that session.

3. Small candlesticks indicate that neither buyers or sellers could move prices that trading session.

4. A long lower shadow (wick) indicates that the sellers controlled the trading session for part of the time but lost control by the end and the buyers took control.

5. A long upper shadow (wick) indicates that the buyers controlled the trading session for part of the time but lost control by the end and the sellers took control.

6. A long upper and lower shadow (wick) indicates that both the sellers and the buyers had their moments during the trading session but neither could overpower the other which resulted in a standoff/indecision.

Common Candles

Bullish
Bearish
Indecision

Bullish/Bearish (see Wicks)
Indecision

Bullish/Bearish

Bullish/Bearish

Indecision

* This content does not represent the views of Bybit. As such, it should be not be seen as trading and financial advice, it is merely an opinion. Trading is done at your own risk.