Bar Vs Candlestick Charts

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Below are a three month bar chart and a three month candlestick chart for IBM. See if you can spot any differences in the "data series."

Hard to spot the difference? That's because there isn't any. Both the bar chart and the candlestick chart contain exactly the same information, only it's presented to the trader in different form. Both the bar chart and the candle chart contain the same data: the high for the period (the day), the low, the open and the close.

In a candlestick chart, however, the names are changed. The difference between the open and the close is called the real body. The amount the stock went higher beyond the real body is called the upper shadow. The amount it went lower is called the lower shadow. If the candle is clear or white it means the opening was lower than the high and the stock went up. If the candle is colored then the stock went down. This information is shown below:

liar Chart Land les Lick High High


Low Lawtr 5had0rt

□own Perkitf

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