How to Read Crypto Candlesticks : Essential Tips for Traders

1.Foundation

For each time interval, a candlestick chart uses a bar (called the “shadow”) and a rectangular box (called the”body“).

For a certain time interval:

The opening and closing prices define the dimensions of the body
The maximum and minimum prices of the considered period define the dimensions of the bar.
The part of the bar above the box is called the “upper shadow”.
The part of the bar below the box is called the “lower shadow”.
What charts are we going to focus on, or what kind of chart do I use daily?

2.Candlestick Patterns

Every trader has his own system and time frame in which he operates.
Candlestick patterns will always be more reliable on higher time frames. I usually operate on 4H – 1D, for a spot position (mid-long term). If I want to swing trade, I focus the time frame on 1H. Candlestick patterns will be more effective and reliable when they occur on support or resistance. That’s why we can only use Candlestick Patterns are confluence and not the basis of ourtrades.

For example, a bullish hammer on a support on 4H – 1D when the RSI is oversold, will mark as a buy. Then, a bearish engulfing candlestick on a resistance on 4H – 1D and RSI is overbought will mark as a sell.

The Time Frame you are going to use depends on yourself, in which time frame you feel more comfortable. But I really encourage you to study that cheat sheet, and you will find the patterns easier.

Click here to download the Cryptochris World Candlestik Cheat Sheet

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