Introduction to Japanese Candlesticks in Forex Price Charts
Today I’m going to start discussing the very interesting and useful topic of Japanese Candlesticks in forex price charts.
There are several tools you can use to determine wise entry and exit points. One set of tools involves looking at forex price charts. At Rapid Forex, japanese candlesticks will be used in virtually every price chart that will be used on the site, so it’s good to learn how to read them 
Charts reveal patterns and can be good predictors of future movement because traders are habitual. While charts can be displayed in several different ways, japenese candlesticks are the most popular way of looking at charts.
Japanese Candlestick Charts are the most useful type of price chart display in today’s forex market ~ (Brian Campbell – founder RapidForex.com)
Japanese candlesticks display price versus time in any time period. The candlestick could represent any time interval, though we will focus on 1 minute, 5 minute, 1 hour, and 1 day candles.
The time interval refers to the “size” of the candle, or the amount of time that passes between the open of the candle and its close. Candlesticks can be charted on any time frame.
The horizontal axis of a candle chart represents that time frame. The time frame could be 15 minutes, 30 minutes, 1 hour, 1 day, 1 month, 1 year, and so on.
In other words, if you are looking at 1 minute candles on a 15 minute chart then you will see 15 candles represented; if you are looking at 1 day candles on a 1 month chart then you will see approximately 20 candles (there are about 20 trading days in the average month).
Japanese candlesticks are very useful for quick visual analysis of charts because you can easily identify whether the bulls or the bears won the tug-of-war of a certain period.
If the bulls won, then the candle formed during that period (which could be one minute, five minutes, one hour, one day, etc.) is called a bullish candle. Bullish candles can be spotted easily because they are unfilled (the body is not colored in).
The color of the candle will depend on the chart, on this blog bullish candles are usually be blue, though you might see bullish candles elsewhere outlined in black or green.
If the bears won the tug-of war of a certain period, then the candle representing trading during that period is called a bearish candle. Bearish candles can be spotted easily because they are filled (the candle’s body is colored in).
The color of the bearish candle will depend on the chart; on this blog they are outlined and filled in red (though you may see bearish candles elsewhere outlined and filled in black).
Tags: bearish candles, brian campbell, bullish candles, candle chart, exit points, Japanese Candlesticks, price charts, rapid forex Posted in
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Joe on 
Don W. on 
Amador on
February 27th, 2010 at 8:04 am
I’m loving the new blog Brian. I just read this post about Japanese candlesticks & I’m so thrilled that you’re giving this stuff away for free.
I paid $2,000 for my first forex course, but you’re revealing it all on your blog.
I’ve accumulated a lot of forex knowledge over the past few years. I’m going to write a post for your blog. I’ve been intending to share my forex knowledge with others for quite awhile. Rather than creating my own site, I’d love to have an opportunity to work with you.
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March 3rd, 2010 at 4:16 pm
Excellent Brian,
I do like red and green candles personally.
D
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Rapid Forex
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March 3rd, 2010 at 5:55 pm
Thanks for dropping by and leaving a comment!
Well that’s the standard traditional setup, but since rapid forex’s colors are blue and red…
Maybe it’s because I like to be different
How long have you been trading?
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March 4th, 2010 at 8:13 am
Hi Brian,
I signed up with you when you first started out being by yourself and then you added someone to the mix at that time to work on Forex. Now I come full circle and look to be getting back involved with Forex again. I need to get everything back together and start over. Hopefully you will get me on the right track. I need to see if I have any of your old books on Forex around my office here at home.
Steve
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March 4th, 2010 at 3:06 pm
@Steve -> Hey it’s great to meet you and come full circle. It’s been a heck of a journey, but I find myself coming back to things I discovered 10 years ago as the really exciting stuff. Forex is one of those things that I just can’t completely walk away from. I look forward to connecting with you through this site.
Isn’t it about time we just kick some ass trading?
I think so!!!
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March 4th, 2010 at 3:39 pm
This comes at a great time. I just got laid off from my job and need to learn new ways to make some money. I searched for ways to make money online and this site came up in google.
I don’t know anything about the forex, but I’ve heard that it’s a good way to make money. Can a broke brother from LA actually succeed by learning this? I’ve got plenty of time, but need to use it wisely before it’s too late.
I appreciate you helping me to understand just what the forex is and how to use it. For now I’ll be following your 20 lessons. Thanks for answering my questions.
Peace & Blessings
Preston
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Rapid Forex
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March 4th, 2010 at 3:46 pm
@Preston -> Thanks for your honesty. You’re getting into the forex at a good time. I’m publishing tons of blog posts that will help you make sense out of the forex market.
Can you succeed? Absolutely! Of course I can’t guarantee this, but there are TRILLIONS of dollars being exchanged every day in the forex. The opportunity is real & that’s why I’m here at rapid forex.
Just follow the lessons and ask questions. If you follow the instructions, you’ll be trading the forex in a few weeks.
Aloha ~ Brian
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March 5th, 2010 at 4:01 am
Hi Brian, I think these lessons are great and I got your other material. Reading some of these posts makes me think that along with teaching the technical aspect you should also be emphasizing that to really succeed you need 2 other very important pieces of the puzzle IMHO.
1. a trade plan – Consider just about every successful thing anyone does starts out with a plan. Trading is no different.
2. Overcoming the fear and greed that will be present especially in the beginning trader. Fear of pulling the trigger because one might lose and greed of taking profits too soon because one doesn’t want to give back what they already gained.
Looking forward to the rest of the lessons.
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Rapid Forex
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March 5th, 2010 at 9:13 am
Hey Bob. Great comments. The trade plan and overcoming fear are taught in later lessons on the blog here. Thanks for pointing out that they could be addressed earlier. Let me kow if you have any other observations that you think would be helpful.
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March 10th, 2010 at 11:07 pm
Hi, Brian’
I’m glad to hear from you again and looking forward to an
interesting trading experience
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Rapid Forex
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March 11th, 2010 at 12:21 am
Hi Amador! It’s great to hear from you too
Thanks for taking the time to comment. I look forward to everything interesting ahead…
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March 11th, 2010 at 5:38 am
Hi Brian,
I am glad you are back into the Forex community online helping the little guys and the season vets alike. Your objective is straightforward, and everyone will benefit greatly.
Most of the new ones that come to the world of currency trading have been burnt by so-called gurus who promised but can not really deliver.
Your presence is going to annoy them in several ways. First, their high end prices courses will remain on the shells rotten.
They are going to start pointing finger at you and maybe try to convince you to side with them. They will make webinars and invite you to speak. Naturally, you will send an invitation to your list and they will capture your list free and they will bombard your list with ads to buy into their products.
Make sure to use some discretion and don’t let this happen. You always deliver in the past and we are sure this time you will over deliver.
Concerning Japanese Candlestics, is there anything else you want to share with us?
I wish myself a good luck for having you back and wishes that our relationship on the blog will be for many years to come.
Thanks.
Walnick
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Rapid Forex
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March 11th, 2010 at 6:55 am
Walnick,
This blog is here to stay permanently!
Thanks for sharing this comment. It’s extremely exciting to hear you so excited about this blog being up! My intention is to only offer quality & useful information for the readers of this blog. Please feel free to leave comments and let me know if you think it’s going the wrong (or right) way. I look forward to interacting with you for many years to come too
Aloha ~ Brian
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March 13th, 2010 at 9:19 am
Where is lesson #1? All I see is advertizing
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Rapid Forex
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March 13th, 2010 at 4:07 pm
Hi Matt,
Lesson #1 should have been emailed to you when you signed up for the free 20 part course. Yes, there is advertising on the site – but that allows me to spend time creating this blog. You don’t have to personally spend any money, but I am still compensated for the many hours of work I do on this site every day. You can access lesson #1 here, just make sure you’re opted-in to the free course and you’ll get a new lesson each day.
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March 13th, 2010 at 10:44 am
Hi Brian, I have just signed up for your 20 lessons. I did some trading last year, using blue a red candles, but managed to lose more money than I gained. I am looking forward to turning this situation around as I have now retired and need to generate some income.
Looking forward to learning how to be a successful trader.
Regards
Michael
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Rapid Forex
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March 13th, 2010 at 4:05 pm
Hi Michael!
Thanks for leaving a comment. I’ve been blogging about trading basics for the past 3 weeks to lay the foundation for what I’ll be sharing next. After taking some time off from the forex, it’s also helping me ease back into forex trading. There’s a serious opportunity there, and together we’ll grab some awesome pips over the next few weeks. The purpose of this blog is to share what I learn, and to learn from others.
I love reading your comments. Please don’t hesitate to ask them!
Aloha ~ Brian
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March 16th, 2010 at 10:47 am
Brian, I am encouraged by your approach. I’ve been in Forex for 6-7 yrs. I am determined to grow a demo account before investing. I lost several hundred in mini’s a few years back. Should we use each of the “tags” after each lesson, to get more specifics? Or wil the detail (on Japanese Csticks) come later?
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Rapid Forex
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March 16th, 2010 at 11:31 pm
Hi Doug! I remember you. It’s good to hear from you after all these years
Yes, the tags are there to help cross reference all the material on this blog. If you are signed up for the eCourse, you’ll get a new lesson each day. These aren’t ALL of the posts on the blog, but rather the ones that will give you the basics in a nice linear order. Clicking on the tags will help you see related posts. I also try to link to related posts from within the text of each post. By reading these supporting blog posts, you’ll get more information and a firmer understanding of trading.
For the next few days I’ll be wrapping up the series of trading articles. I’ve been building a little cross indexed forex manual for reference. Soon I’ll be creating trading videos that will show you these concepts in real life action. But I’ll continue to reference many of these articles to supplement/enhance future blog posts.
Thanks for taking the time to comment. If you have any more questions, please feel free to ask!
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March 17th, 2010 at 4:01 am
Brian – thank-you for putting in your time to do this blog. It is much appreciated by those of us who thirst for knowledge.
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March 19th, 2010 at 3:55 pm
Brian,
Great to hear from you again. I had signed up for your forex a couple of years ago and was saving the lessons on my computer but the hard drive crashed and I lost everything. I now use a backup and an external hard drive. A hard lesson to learn. Look forward to starting over with you. Thanks for including me in this opportunity.
God Bless
Jim
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Rapid Forex
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March 19th, 2010 at 4:08 pm
Hey Jim, I remember you. I’ve also lost really important stuff without it being backed up a few times in the pasy. Yes, it’s very PAINFUL!
It’s great to reconnect with you. I also look forward to starting over on the never ending quest to conquer the forex.
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March 19th, 2010 at 11:59 pm
Hi Brian,
I am looking to learn FX trading for months now but didn’t come across anyone offered free lesson like this one. Thanks for given me this opportunity and hopefully to make some incomes too.
Kind Regards
Chan
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March 20th, 2010 at 1:53 pm
Hi there Brian, I am so glad to have you and rapidforex.com back it was the very start of my trading career that I first met you and since I have used most of the techniques in your original Rapid forex course I purchased many yewars ago
, I have had a trememndous lot of success with your scalping course and recently started going for the longer term trades of more than a few days using the forex surfing techniques they are amazing and with small adaptations I have made them more appropriate for my style of trading – I really thank you so much for teaching me the very best techniques for making money in the forex, and now giving it away free to new users is incredibly generous of you and shows the world how serious and kind you are – once again THANK YOU THANK YOU THANK YOU – I am your fan all the way
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Rapid Forex
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March 20th, 2010 at 2:04 pm
Hey Dan,
Wow! Thanks for sharing that. You mentioned that you’ve adapted the methods to your style of trading, would you care to elaborate? I’d love to share your tips with the readers of this blog, if you had the time or desire to share what you’ve learned
Thanks for leaving this comment, I’m glad you’ve had success with the stuff I put together in the past. My plans for sharing more cool stuff in the future will hopefully dramatically exceed what was done in the past!
Aloha,
Brian Campbell
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March 24th, 2010 at 9:02 pm
Regarding candle patterns, different time frames always giving different patterns, and often times, conflicting to each other.
If i am looking at daily candles,i get one candle pattern,and looking at higher weekly time frame and the lower intraday 60 or 15 min candle patterns,they are all different–almost without exception,and many times conflicting each other.
How should we handle this?
Thanks for your reply
jack
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Rapid Forex
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March 24th, 2010 at 10:05 pm
Jack,
Different time frames suggest different trends. For instance, on 5 minute charts there could be an obvious downtrend. On the daily charts it could be a steady uptrend. All this means is that the shorter term trend will likely go in the direction of the main trend. The larger time frames are the overriding trends, but they may take a long time and allow several shorter trends to unfold. I’m actually creating videos that discuss this right now, which will be released on the website shortly.
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April 13th, 2010 at 11:51 pm
Brian thanks for the intro to candles , looking forward to seeing how they are used for entries and exits ,
hello to all other learners and traders also
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April 15th, 2010 at 2:47 pm
My daily Market Club Traders Blog email linked me to Rapid Forex Article by Brian C. and I am very glad it did. This is exactly what a “newbie” needs to begin learning first before investing and trading in the Forex Currency Market. Thanks for all that you’re providing for free and everyone’s comments are very helpful and trusting.
Tim G. from Maryland.
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Rapid Forex
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April 16th, 2010 at 10:37 am
@Tim – thanks for sharing your thoughts on the blog. I’m thrilled that you are enjoying the content on the rapid forex blog. I’m putting together a course that ties all of the technical analysis & fundamental analysis up into a neat little package without over-analyzing things. By looking at what’s important we can save tons of time and still make tons of pips
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April 15th, 2010 at 2:52 pm
I’ve read and learned about candle charting before, but your explaination simplified it better and I hope to learn more from your perspective.
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April 16th, 2010 at 7:49 am
Hi Brian, thks for lesson 1, i am looking forward to all u have to show, i have been trading, or trying to, for 10 months now, a lot of mistakes daily, so am really ready for this,all the best Judd.
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April 17th, 2010 at 12:02 am
Hi Brian,thks for this write-up,I’ve gotten my fingers burnt b/4 and thinking about quiting fx.Stumbling on you may likely give me a hope of bouncing back. Thanks.
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April 17th, 2010 at 1:21 am
Thank you for Lesson 1, I’m looking forward to receiving each lesson and using what I have learned to earn more Pips. Keep up the good work.
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April 17th, 2010 at 2:09 pm
hello Brian
I´ve already post a comment, there must be on another page i guess, because it does not appear here, anyway I just want to thank you for your help, I got a little office to do my trading at home, and one of the walls is the ” FRANCISCO´S GROUP OF TRADERS WALL OF FAME, where I hung up photographs of all the profesional traders and good will people that helped me achieve consistency in my trading for all my friends and family to see, I hope I can put your picture on the wall along with Mr. Richard Donchian, Richard Dennis, Bill Poulos, Henry Liu and Michael Covel.
you seem very honest and very profesional, and you haven´t tried to sell me anything so far, so I will work with your guidence so we can have a drink in Maui, my treat.
sorry for my grammar, Im Mexican, viva forex ahuuua!!!
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Rapid Forex
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April 17th, 2010 at 2:11 pm
@Francisco – the advertisers pay for the blog. I don’t charge blog readers for any of the information I share. My only hope is that it will benefit you and help you be successful so you will tell me
I’d be happy to have a drink with you in Maui. My favorite place is called the “Mai Tai Bar” in Lahaina. We’ll have to go there someday 
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April 17th, 2010 at 4:03 pm
Hi Brian – I’m grateful for the information you’re providing and, like you, if forex positively impacts my life I will share what I’ve learned with others.
Before I get too excited about forex, though, I need to get a sense of what a reasonable (non-greedy) income-making potential forex is. I have a nice income and I’m not needy or greedy about making as much money as possible. I’d like a second income that could replace my primary income if necessary.
For example, if I wanted to earn $2,500 per month with Forex (I make much more than that now) is that feasible after 6 months of study and, if so, with how much capital? I’ve seen sites claim that 2 to 5% per month is reasonable to earn. 5% per month seems awfully high to me but, even if I could make that I’d need $50,000 in capital for that level of return.
I’d love to read your response to this question as I’d like to have a realistic (not overblown) set of expectations up front to know if forex is for me.
Thanks.
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Rapid Forex
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April 17th, 2010 at 6:03 pm
@Sol – I’ll be addressing this exact question in a Forex Sailing blog post later this week. Please be a little patient as I will show you not only what’s possible but how you can plan for any income you desire.
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April 18th, 2010 at 6:08 am
Brian – Ok, I’ll be patient. Thank you.
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April 19th, 2010 at 1:10 am
Hi Brian,
Thank you for your first lesson on Candlestick that I’ve received today.
I’ve read the Japanese Candlestick by Steve Nison so I’m very familiar with various Candlestick patterns such as bullish engulfing, shooting star etc…
I would like to find out how do you integrate the candlestick with your trading strategy/method?
I would also suggest that you could use your past trades as an example to illustrate your strategy.
Regards,
Toyogo
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April 19th, 2010 at 3:04 am
Hi Brian
Thanks for lesson 1 and looking forward to learning from you and hopefully one day I can travel the world like you.
Regarding 4 hour chart timeframe, do you have any specific time of the day to check the market and set the price? I live in Australia, Sydney time, can you please recommend?
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April 19th, 2010 at 1:47 pm
You can count on it buddy!! lahaina it is.
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April 20th, 2010 at 6:01 pm
Hi Brain,
I want to thank you for lesson #1. I’m looking forward to learning more about forex trading. I have been day trading stocks for about a year now and would also like to trade forex too. I have read through most of your website and I am very impressed with the amount of information you have posted there. Thank you again! ~Jim
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April 27th, 2010 at 1:37 am
Brian, I was taking a flight yesterday and to while away the time watched a programme about the first female chess grandmaster. In summary her skill was not about remembering where pieces go individually but about recognising patterns that appear over and over again. Having started at a young age she was able to ‘hard wire’ these patterns into her brain for recall during matches. This concept seems to fit well with the trading you talk about and I can appreciate that some sweat equity will be involved to get to a point where the patterns you mention become almost second nature to us. I’m looking forward to the journey.
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Rapid Forex
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April 27th, 2010 at 1:38 am
@John – this is a great analogy. Do you remember the name of the film? It sounds interesting…
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May 7th, 2010 at 8:57 pm
Thanks for your lesson on Japanese candle sticks. I’m still trying to get the basics of this forex market-i’m a little bit confused. I would like you to put me through on how to know the time associated to single candle stick. Cos you said something about time for candle stick and the chart.
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May 10th, 2010 at 4:32 pm
Hi Brain,
I forgot to mention earlier. I have been digesting and working on the tips I’m learning from forex surfing and forex scalping and I must confess that out of the hundred of strategies I have tried in the past, I made up my mind that this was the answer to my prayers of seeking for a profitable strategy. I saw truck loads of sense and wisdom on going about trading that I have not discovered elsewhere in my exhausting search for a system that works, and I am truly grateful, the least I can say is thanks.
I intend to go live in about a months time, I will briefly be having a 1 month break from work and I intend to trade actively, scalping and the rest, but where I need your advice is about a reliable broker I can use for my live account.
I seem to have some issues with the two brokers suggested in the book. I have seen ACM for quite a while on the net and I was attracted to their competitive advantage as a broker right from the out set, I will say I like them and your suggestion of them as a useful broker dispelled any doubt I may have had about their claims BUT unfortunately for me they do not “accept clients domiciled in my country at the moment”
FXCM would have been good too as I have interacted with their trading platform and I find it user friendly, but I overheard that a number of people had technical trading issues with them when the market took a shocking dive on some of the pairs last Thursday (Had my real account wiped out during that incidence, just when I had started understanding how the market worked! Anyway I learnt to follow good MM and never to trade again without stop loss. In fact, I discovered rapid forex after that loss and you can understand why I said earlier it was a prayer answered!). People had issues with FXCM like the platform getting freezed for minutes and people could not modify their positions to adjust to the market, though my “late account” was not with FXCM anyway.
I’m used to the MT4 platform, but I realise that MT4 does not offer the kind of market order flexibility seen with FXCM platform for example.
I went into all these details because it was recommended that one practices a virtual account with the intended market platform to get familiarized before opening a real account. I like FXCM but I wont like to be working on a platform that may have such Issues i talked about.
Pls I would really appreciate if you can suggest a broker with a profile close to ACM’s that I can use to demotrade b4 opening my live account.
Some one talked about being paid $300/h for consultation! I hope I won,t be slammed a huge bill for taking your time to read my loooong comment. If you mind, I’ll keep further comments as brief as possible.
I will be expecting your response
Thanks a lot
Samson
Nigeria
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May 18th, 2010 at 3:47 pm
I’m excited about the free course and I’m ready to get serious and become one of those traders in the top 2%. Your blog seems to be in down to earth langauge. Thanks alot
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May 30th, 2010 at 5:17 pm
lOOKING FORWARD TO WHAT YOU HAVE TO SAY, READY TO LEARN EVERYTHING YOU SAY – MOST IMPRESSED, MAYBE ONE DAY I’LL BE ABLE TO TRAIN MY OWN CHILDREN TO DO THIS AS WELL, I CAN HOPE….
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June 26th, 2010 at 1:34 am
l stumble on your site about two days ago and I really appreciate your opened mind help people in general particularlly me and l will be ready to go through the necessary lessons as you promised and any other you might considered necessary and giving you feedback.
Thanks.
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July 3rd, 2010 at 11:46 pm
Hi Brian
I’m new to this forex stuff and was just about to open a live account until I came across your blog.
Wow, have I got a lot to learn. I’ve signed up for your e Course and I hope to gain as much knowledge and experience from you postings.
Cheers…
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September 1st, 2010 at 12:08 pm
I have a friend that is taking a different forex coarse. He says that pivot points are mandatory in order to become a successful forex trader. Are pivot points similar to Japanese candlesticks in how they function?
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Rapid Forex
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September 2nd, 2010 at 1:12 am
@Alfred – pivot points are entirely different than japanese candlesticks. Candlesticks are a type of price chart, while pivot points are calculated price targets that get superimposed on the price chart…
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