What one candle says
Each candle packs four numbers for its period: the open, the high, the low and the close (OHLC). The thick 'body' spans the open and close; the thin 'wicks' reach up to the high and down to the low.
A green (hollow) candle closed higher than it opened — buyers won the period. A red (filled) candle closed lower — sellers won. The longer the body, the more decisive the move; long wicks show a level that was tested and rejected.
Timeframe is a choice, not a fact
The same stock looks bullish on a daily chart and bearish on a weekly one, or vice-versa. Neither is 'right' — they answer different questions. Long-term investors read weekly/monthly; swing traders read daily; the intraday crowd reads minutes.
Rule of thumb: pick a timeframe that matches how long you actually intend to hold. Mixing signals from wildly different timeframes is where most beginners get whipsawed.
Reading a candle at a glance
Four quick questions turn a candle from a blob into information:
- Body size — big body = conviction, tiny body (doji) = indecision.
- Where's the close within the range? Closing near the high is strong; near the low, weak — even on a green candle.
- Which wick is long? A long lower wick = lows were rejected; a long upper wick = highs were rejected.
- How does it compare to recent candles — bigger range and volume mean the character is changing.
The beginner mistakes
Two traps snare almost everyone at the start. First, judging a candle by colour alone — a green candle that closes on its lows is a warning, not a win. Second, zooming into a five-minute chart to 'day-trade' a stock you actually mean to hold for months; the noise there has nothing to do with your horizon.
Fix both by always framing your timeframe first (the one that matches your holding period) and reading the close, not the colour.