What is the difference between bearish and bullish candles?

Candlestick charts are a popular tool for analyzing cryptocurrency price movements. They provide visual representations of price action over time, allowing traders to identify trends and patterns.

One key aspect of candlesticks is the difference between bullish and bearish candles. In bullish candles, the open price is located at the bottom of the candlestick, indicating that the price opened lower and closed higher during the specified time period.

Conversely, in bearish candles, the open price is found at the top of the candlestick. This indicates that the price opened higher and closed lower, suggesting a downward trend in the market.

Another important feature of candlesticks is the wicks, or shadows, that form during the candle interval. These represent the highest and lowest prices reached during the time period, but not necessarily the open or close prices.

Analyzing the length and direction of wicks can provide valuable insights into market sentiment and potential price movements. For example, a long upper wick may indicate that sellers were able to push the price down from its intraday high, suggesting a potential reversal in the short term.