Candlesticks

In the 1600's the Japanese were the first to use technical analysis to trade rice futures which lead to the development of the charting method called "candlesticks" in the 1700's. A candlestick chart is made up of both black and white "candle" bodies that often have "wicks" on both ends. A single white candlestick body shows that the opening price was at the bottom of the body and that the closing price was at the top of the body which means there was a gain for that period. If the candle has wicks on either end, the bottom wick represents the low prices traded during that period and the top wick indicates the high of the period. When the body of the candle is black or colored in, the opening price is the top of the candle body and the closing price is the bottom of the candle body. If there are wicks present, they represent intra-day highs and lows.

Candlesticks allow you to get a quick read on the changes in supply and demand. When combined with critical day analysis, candlestick interpretation can help in confirming a trend reversal very early in the movement. Critical days are given to members three days before the actual critical day arrives. It provides you with advance warning of a potential trend reversal.