Candlestick Charts

Candlestick Charts

candlestick chart is a style of bar-chart used primarily to describe price movements of a security,derivative, or currency for a designated span of time.

It is a combination of a line-chart and a bar-chart, in that each bar represents the range of price movement over a given time interval. It is most often used in technical analysis of equity and currency price patterns. They appear superficially similar to box plots, but are unrelated.

History

Candlestick charts are thought to have been developed in the 18th century by Munehisa Homma, Japanese rice trader of financial instruments.[citation needed]. They were introduced to the Western world by Steve Nison in his book, Japanese Candlestick Charting Techniques.[1]

In Beyond Candlesticks,[2] Nison says, “However, based on my research, it is unlikely that Homma used candle charts. As will be seen later, when I discuss the evolution of the candle charts, it was more likely that candle charts were developed in the early part of the Meiji period in Japan (in the late 1800s).”

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