Steemit Crypto Academy Season 4 Beginner's Course - Task 10: Candlestick Patterns.

Hello everyone. This lecture is about the most commonly used chart which is Japanese candlestick chart. I first thanks to the professor @reminiscence01 for this amazing lecture and now let start the assignment.

Question 1- Explain the Japanese Candlestick Chart?

The candle stick chart is a tool to analyze the market. This tool was introduce in 1990 By the Japanese farmer. This tool is used in technical analyzes to analyze the market trend. This is most common and mostly used indicator by the traders. The traders use this tool to get the idea about the market trend and to take the trading decisions.

This tool help you to analyze the market using the candles on the chart. The candles are by default are two colors; green which represent the bullish trend and the red which represent the bearish trend. When you see that the green candles are there more in the market, its mean that the demand of the coin is rising and price is increasing. But on the other hand if you see the red color in the chart more, its mean that the market is declining and price is decreasing.

This chart use the demand and supply rule to analyze the market. If the demand rise, the price of the coin will increase then and the supply which is inversely proportional to the demand will decrease. In this case, you will see the green color candles which mean that the market is in bullish trend.

But when the supply increase, the price and demand of the coin decrease then. In that case, the red color candles are seen more on the chart which mean that the market is falling down. On the chart, support and resistance level help the trader to determine where the market is trending. If the wick line is below, it show the support level and if wick line is above, it show the resistance level.

The Japanese candle stick chart not just help you to determine the market future but also help you to get to know about the closing and opening price of the coin for a specific time period. The traders get to know much more about the market just seeing the candle stick chart. It is an easy way to analyze the market because the traders do not need to face any sort of complication. This tool help a lot in a successful trading journey.

The bullish trend is a good spot to sell the coin because the price is high here and traders get good profit by selling their hold coins. If the market is in bearish trend, then the traders should buy the coin because the coin price is low in bearish trend. So traders get an entry into the market by seeing the market is in bearish trend on the chart. This chart give you information about the closing, opening, highest , lowest, support and resistance level.

Source

• Low- It shows the lowest price of the asset in a specific time duration

• High- It show the highest price of the coin in a specific time duration.

• Open- Opening price of the asset

• Close- Closing price of the asset

• Wick- The point where the price start fluctuating. If wick line is below, it mean that the market is in downtrend and if the wick line is above, it mean that the market is uptrend

Question 2- In your own word, explain why the Japanese candlestick chart is mostly used by traders.

Multiple tool are there to analyze the market in crypto world. The traders use these tools according to their easiness and need. But the Japanese candle stick chart is most commonly use technical analyses tool to analyze the market. The traders use this tool more as compare to the other tool because this tool is much simple and easy to understand.

The traders get the whole idea about the market performance by seeing the Japanese candle stick chart. You get the much information about where the market is trending and you can take decisions according to the situation.

Not just the market direction, but the Japanese candle stick chart help you to get the information about the market opening, closing, high and low prices. This much information help you to trade in a good way. You do not need to use other tools. You get information just with this tool and can take the important trading decisions.

The demand-supply concept is use in the japanese candle stick chart. If the demand of the coin rise, it mean that market is trending upward. If the supply of the coin increase, it mean that the market is trending downward.

This chart is so simple and easy. There are no complication. You can determine the market future in an easy way. The market trend is also get to pick just by seeing the candle's direction. If the candles are moving upward, it mean that the market is trending upward and if the candles are moving downward, it mean that the market is trending downward.

You get to know when to enter into the market or when to exit from the market. This chart save your money from lose and help you to earn good profit.

Some key points

• Easy and simple

• No complexion

• Clear graphical image of market

• Get to know about closing, opening, high and low price of the coin

• Get to know about market trend

• Help to predict what the future of the market

• Help to determine whether to enter into the market or exit from the market.

• Help to determine entry and exit spot.

Question 3- Describe a bullish and a bearish candle. Also, explain its anatomy. (Original screenshot required)

Bearish Trend

When the price of the coin rise in uptrend, the traders find it a good spot to sell their coins. They sell their assets and earn the high profit. Because of high selling ratio, the demand get decrease and supply ratio start increasing. This cause an bearish trend occurrence in the market.

In bearish trend, the market is trending downward. The direction of the candle is downward. the bearish trend is a good point for the traders to enter into the market by purchasing the coins because the price of the coin is low in the bearish trend. The traders can buy the coin in bearish trend at low price and can earn good reward by selling those coins in market uptrend. Red candles show the market bearish trend

Bullish trend

When the price of the coin decrease, the traders find it a good spot to buy coins. They They buy the coins at the low price. Because of high purchasing ratio, the demand get increase and supply ratio start decreasing. This cause an bullish trend occurrence in the market.

In Bullish trend, the market is trending upward. The direction of the candle is upward. the bullish trend is a good point for the traders to exit from the market by selling the coins because the price of the coin is high in the bullish trend. The traders can sell their coins at high price and can earn good reward. Green candles show the market bullish trend

Source

Opening point - This show the opening price of the coin in a time period. This is the point when the market build. At the opening point, the candles in the chart start to bult.

Closing point - This show the closing price of the coin in a specific time period in the market.

Highest price - This show the highest price of the coin in a specific time period in the market

Lowest price - This show the Lowest price of the coin in a specific time period in the market

Wick line - The wick line help to get the idea about the support and resistance level. If the wick line is above, it show the resistance level. And if the line is below, it represent the support level. It help you to determine when to enter into the market and when to exit from the market.

Main body- The main is represent the difference between the opening and closing price of an asset in a specific time duration.

Conclusion

The japanese candle stick chart is very important while analyzing the market. This tool help to determine the market opening, closing, highest and lowest price of the coin for a specific time period. The traders use this chart mostly and frequently to analyze the market. This tool help them to take the important trading decisions.

The red and green are the default color of the candles but you can change the colors too. I am thankful to the professor @sapwood and @reminiscence01 for this amazing and important lecture.

Cc:

@sapwood
@reminiscence01
 @nane15
 @dilchamo
 
Regard

@sherazsultan