Constructing candlestick real bodies and multi-session patterns

Build the real body first

A candlestick real body is drawn from the session open to the session close. The shadows are the thin high and low extensions beyond that body.

A white candlestick uses an empty real body because the close is above the open. A black candlestick uses a filled real body because the close is below the open.

Same open, high, low, and close as a bar chart

Candle charts use the same open, high, low, and close as bar charts, so moving averages, trendlines, and retracements can be constructed on the candle chart.

The same open-high-low-close candle construction can be plotted from intraday through weekly and monthly scales.

Named multi-session conditions

Most candlestick patterns are built over two or three sessions. A high-and-low price gapping play can span as many as eight or nine sessions.

Completed candlestick formations usually mark reversal or continuation conditions and do not themselves specify a price objective.

A hammer is constructed as a small real body at the top of the range with a long lower shadow. It records an open near the highs, a sharp selloff, and a close back near the highs during a decline.

Windows are continuation and resistance constructions. A harami is an exhaustion construction. Shooting star, hanging man, hammer, and doji star are reversal constructions.

Overnight gaps on equities

Pattern rules that require a change between the prior close and the next open often need adjustment on equities. That overnight disparity is typically smaller than in futures.