A candlestick chart shows the price movement of a stock for each time period using a “candle” that captures four prices: open, high, low and close. It is the most common chart type used by traders in India.
Each candle has a body and wicks. The body covers the range between the open and the close. The thin lines above and below, called wicks or shadows, mark the highest and lowest prices of that period. A green (or hollow) candle means the close was higher than the open; a red (or filled) candle means it closed lower.
Say a hypothetical stock opens at ₹200, goes up to ₹212, dips to ₹197 and closes at ₹208. That day forms a green candle with a body from ₹200 to ₹208, an upper wick to ₹212 and a lower wick to ₹197. You can draw candles for any timeframe, from 1 minute to 1 month.
Compared with a line chart, which only joins closing prices, candles show you the fight between buyers and sellers inside each period. A long lower wick, for instance, tells you sellers pushed price down but buyers took it back.
Candles are the first chapter in our Technical Analysis course, where you practise reading them on live charts before moving to patterns.