Published November 1, 2026 · Beginner education
THE IDEA, IN PLAIN LANGUAGE
A candle summarizes opening, high, low and closing prices over a chosen period. Its body shows the open-to-close range and its wicks show the extremes. Colors depend on chart settings. A shape alone cannot predict the next move.
KEY VOCABULARY
- OHLC
- Open, high, low and close.
- Wick
- Line showing the price extreme outside the candle body.
A PRACTICAL EXAMPLE
On a one-hour chart, each completed candle summarizes that hour. A long lower wick shows price traded lower before recovering within the period.
A COMMON MISTAKE
Treating a named candle pattern as a guarantee.
WHAT TO REMEMBER
A candle describes past prices. It does not promise future direction.
SOURCE REFERENCES
Use these external resources to study further. Explanations here are our own; external resources may change.
- BabyPips: related source lesson ↗
- BabyPips: School of Pipsology — beginner forex curriculum ↗
- CFTC: understand forex risks ↗
RELATED VIDEOS
No lesson-specific video is published here yet. Follow @koufaxbtb on Instagram for existing creator content; it is not a substitute for these source references.