What Is a Candlestick? The Apple Stand Explained

Full transcript

Imagine you sell apples and you open your little stand on the 1st of December. You decide to charge 10 Rand per bag — and that very first price you set is what traders call the OPEN. During the month, a fuel truck rolls in and pushes your costs up, so your price jumps all the way to 15 Rand — and that peak is what we call the HIGH for the period. Then farmers flood the market with overflowing crates of apples, and suddenly competition is everywhere. To clear your stock, you drop your price all the way down to 6 Rand — that rock-bottom price is your LOW. By the final week of December, the market settles down and you find your footing again. You set your closing price at 12 Rand to lock in a profit — and that final price of the period is called the CLOSE. Now we take all four of those prices — the Open at 10, the High at 15, the Low at 6, and the Close at 12 — and we plot them on a simple chart. We draw a thin vertical wick from the Low to the High, and then a solid rectangle for the body between the Open and the Close. And just like that, one single candle tells you the entire story of the month — where the price started, how high it climbed, how low it fell, and where it finished. That right there is the core foundation of reading financial markets like a trader.