Since the forex candlesticks come in many different shapes, these shapes have been categorized, and each shape has a different name. Also, since the trading candlesticks were invented by the Japanese, many of the names are Japanese! So get ready to learn some Asian vocabulary as you get a deeper understanding of the candles.
This is what happens to a pretty lady when she is Marubozu:
And this is what happens to candlesticks when they are Marubozu:
If the candle is completely “shaved,” with no shadows coming from either the top or the bottom of it, it is called marubozu.
Marubozu candles have very powerful spirits. In fact, they are the most powerful candlesticks known to the trading community. They have no upper or lower shadows, which means that the pair didn’t even bother to test a price outside of the open and close prices. The price just went straight up (if it is a bullish marubozu) or straight down (if it’s a bearish marubozu).
This one has an English name! And as the name suggests, these candlesticks have very short bodies but long shadows .
Spirit: Spinning tops have very indecisive spirits. During the specific time frame in which a spinning top is formed, the pair was mostly testing different prices and didn’t really move that much. This can also mean that the forex puppet master (which includes the traders and the markets) was kind of indecisive on which way to move the pair.
You almost want to scream out: “Make a decision already!!”
But who would listen?
Another Japanese word to add to your dictionary! Doji candles have equal (same) open and close prices. That is why their bodies are nothing but a line. You can’t even distinguish their color!
Depending on the length of the shadows of a doji candle, it can be put into different categories such as the “long-legged doji,” the “dragon fly doji,” and the “gravestone doji.”
Spirit: Doji by itself is neither bullish nor bearish. But when it comes after other candles, it can have very powerful interpretations. We will get into that later.
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