Bullish and Bearish Candles — Understanding Price Charts

Bullish vs. Bearish, Defined

A bullish candle closes higher than it opened, meaning buyers were in control over that period. A bearish candle closes lower than it opened, meaning sellers were in control.

Most charting platforms color bullish candles green or white and bearish candles red or black, but these colors are just a convention — you can usually change them, so always check what open/close actually happened rather than assuming from color alone.

[Read the lesson: Bullish and Bearish Candles](/learn-to-trade/understanding-price-charts/bullish-and-bearish-candles)

Strength Is a Spectrum, Not a Switch

Not all bullish candles are equally bullish. A candle that closes only slightly above its open shows weak, hesitant buying, while a candle that closes far above its open with little wick shows strong, confident buying.

**Comparing Two Bullish Candles:** Candle A opens at 1.1000 and closes at 1.1005 (a 5-pip gain) with long wicks on both sides. Candle B opens at 1.1000 and closes at 1.1060 (a 60-pip gain) with almost no wicks. Both are technically 'bullish,' but Candle B reflects far more decisive buying pressure than Candle A.

[Read the lesson: Bullish and Bearish Candles](/learn-to-trade/understanding-price-charts/bullish-and-bearish-candles)

A Few Simple Single-Candle Signals

A 'doji' is a candle where the open and close are nearly equal, producing a tiny or nonexistent body — it signals indecision between buyers and sellers.

A 'hammer' has a small body near the top of its range with a long lower wick, often appearing after a decline and hinting that sellers tried to push lower but buyers stepped in. Its bearish mirror, sometimes called a 'shooting star,' has a long upper wick near the top of an uptrend.

[Read the lesson: Bullish and Bearish Candles](/learn-to-trade/understanding-price-charts/bullish-and-bearish-candles)

Context Matters More Than the Candle Alone

A hammer that appears in the middle of a quiet sideways range means far less than a hammer that appears after a sharp, multi-day decline. Single candles are clues, not verdicts — they should be read alongside the broader trend and nearby support or resistance levels, which we'll cover soon.

[Read the lesson: Bullish and Bearish Candles](/learn-to-trade/understanding-price-charts/bullish-and-bearish-candles)