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Season 1Episode 152:06

One candle: what four things does it tell you?

In this lesson Read open, high, low, close and the time frame; don't treat colour or a single shape as a prediction.

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Key takeaways

  1. One candle shows four prices for one period: open, high, low and close.

  2. Read the time frame before the shape: five minutes is not a day.

  3. Colours differ between apps, and one candle is a record, not a prediction.

Quick check

A five-minute candle opens at 50,000, reaches 51,000, dips to 49,000 and closes at 50,500. What is the high?

Try it yourself

On a virtual candle, tap open, high, low and close, and confirm the chart time frame.

Show the answer

50,000 / 51,000 / 49,000 / 50,500; time frame five minutes.

Transcript

  1. Sam

    Green means it keeps going up next, right?

  2. Nexubo

    One candle records four prices for one period: open, high, low and close. This is made-up five-minute data. It's not a promise about the next five minutes.

  3. Narrator

    The body shows the gap between open and close. The wicks mark the highest and lowest prices in that period. A candle that hasn't finished yet keeps changing with new trades.

  4. Sam

    Why does the chart look different when I switch the time frame?

  5. Nexubo

    Each candle now covers a different length of time. Read the time frame first, then the shape. Don't mistake five minutes for a day.

  6. Narrator

    Apps may use different colours for up and down, so read the legend and the numbers. Past moves can be informative, but one candle can't guarantee the next move.

  7. Sam

    High 51,000. Close 50,500.

  8. Nexubo

    Read the record first. Don't treat a record as a prophecy.

  9. Narrator

    'I have 1,000 and only want to risk 20. So I go all in?' Next: how much to buy.

  10. Narrator

    Understand first, then act.