Candlestick charts are widely used by traders around the world, as superficial demarcations between East and West are thankfully fading away. While bar charts are still more popular because of sheer inertia, there is little doubt that candles provide much more information, even though both types of charts are based on the same prices. Let?s take a look at the advantages of using candles when gauging the validity of intersections.
Traders make a big deal about prices breaking support and resistance lines, trendlines, moving averages and retracement or extension levels. However, intersecting these lines on an intraday basis and closing outside them are two very different ball games.
Benefits for Using Candlesticks
Let?s quickly review the reasons why traders should use candlestick charts for daily, weekly and hourly charts:
Candles make it easy to separate bullish periods from bearish periods.You can easily do that by looking at the different colors of the candles.
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