In this article
After this article, you can
- Compare candle ranges in price units.
- Distinguish pixel height from a common-scale measurement.
Terms at hand: Pip · Trading Journal
A Japanese candle displays Open, High, Low and Close for one interval. Learn to calculate body, shadows and range before attaching a pattern name. Those distances can be checked; a story about participants’ intentions or the next move needs separate evidence.
Similar candles on screenshots? Check the scale.
On independent screenshots a candle may have identical pixel height but a different price range. Fictional A has O101,H104,L100,C103; B has O105,H120,L100,C115. Both bodies occupy half their own range.
Scroll sideways to see the full diagram
A's range is4 and B's20 units. Body shares are2/4 and10/20, both50%. Similar proportions do not imply similar move sizes. Copy OHLC and price-unit distances when comparing screenshots, and use a shared scale for visual comparison. Pixel height without axes does not establish range.
Assumptions: An illustrative drawing model: separate axes fit full ranges into200 pixels; the shared linear axis covers100–120. Prices and heights are arbitrary, with no future-direction inference.
Read four prices before interpreting the shape
Open and Close are the first and last recorded prices used for the interval; High and Low are its extrema. The source can contain quotes rather than executed trades. H1 denotes a one-hour interval, whose start boundary and clock still need specifying.
The body spans Open to Close. Upper shadow extends from the higher endpoint to High; lower shadow extends from Low to the lower endpoint. Close above Open means a rising body under the usual convention. It does not establish a subsequent rise.
Use two independent fictional EUR/USD candles, not consecutive hours or a trade record. Candle A is O 1.1000, H 1.1030, L 1.0990, C 1.1020. Candle B exchanges only Open and Close. One pip in this model is 0.0001 USD per EUR.
| Measurement | Formula | A, pips | B, pips |
|---|---|---|---|
| Range | High − Low | 40 | 40 |
| Body length | |Close − Open| | 20 | 20 |
| Upper shadow | High − max(Open,Close) | 10 | 10 |
| Lower shadow | min(Open,Close) − Low | 10 | 10 |
| Signed change | Close − Open | +20 | −20 |
Both satisfy 10 + 20 + 10 = 40 pips, and body share is 20/40 = 50%. This is the model’s proportion, not a universal strong-candle threshold. Open/Close labels establish the sign even without colour.
An arithmetic identity is not a complete data check
Valid data require Low ≤ min(Open,Close) and max(Open,Close) ≤ High. Check those inequalities before ratios. The sum of shadows and body can match the range even in a malformed record.
As a deliberate import-test error, use O 1.1000, H 1.1010, L 1.0990, C 1.1020. Close exceeds the alleged High. The formulas yield body 20 pips, lower shadow 10 and upper shadow −10; their sum is still 20, equal to High − Low. A negative shadow is a data inconsistency, not a pattern variant. Clamping it to zero would hide the failure.
The separate screenshot diagram gives A range 4, body 2 and B range 20, body 10 in arbitrary units. Both bodies occupy 50%. Independent axes make both ranges 200 pixels tall; one common 10-pixels-per-unit axis makes them 40 and 200 pixels. Equal displayed height does not establish equal price distance.
Keep endpoint change separate from the full path
The 40-pip range is not total distance travelled or an available 40-pip profit. Price may revisit levels, while a trade also requires entry, exit, side, size and costs. OHLC does not reveal which extreme came first or how long price remained at it.
For candle A, an assigned preceding Close 1.1040 gives a decline of 20 pips against that preceding value, despite a rise of 20 pips against its own Open. Those are different comparisons, not contradictory records.
If Open equals Close, body length is zero even when High and Low differ. If all four prices equal 100, range is zero and body/range is undefined, rather than automatically zero percent. Such a mark does not establish the absence of every transaction in the market.
As one further fictional exercise, retain O 1.1000, H 1.1030 and L 1.0990 but set C 1.0995. Body is 5 pips, upper shadow 30 and lower shadow 5; range is 40 and signed change −5. Body share is 12.5%. No future direction follows from this calculation.
Check source, clock and display settings
Read OHLC from the ordinary candle’s data view and record symbol, feed, price type, interval and boundaries. An open bar’s current Close and extrema can change until completion. A completed-shape rule cannot use its final Close before that information exists.
MetaTrader 5 documents Bid-based OTC charts and Last-based exchange charts. Quotes are not a record of all completed trades. TradingView can colour a candle against its previous Close rather than its own Open; check that option when colour and the body seem inconsistent.
An OHLC bar can show the same four values: vertical High–Low with a left Open tick and right Close tick. HLC mode omits Open, and a close-only line does not retain intraperiod extrema. Select the actual chart variant before comparing information.
Write a neutral description first: Close 20 pips above Open, range 40, shadows 10 each. Keep shape classification and a tested trading rule separate. A shape does not count orders, identify trader motives, establish a stronger timeframe or assign a false-breakout frequency.
Check your understanding
One short exercise
About 2 min · you can try again
Separate axes show equal-height candles. A has H204/L200; B has H220/L200. Which conclusion is checkable?
- Equal ranges because pixels match.
- B's range is five times larger in price units.
- B must earn five times more profit.
Check the answer and explanation
B's range is five times larger in price units.
20/4=5 regardless of cropping.
Frequently asked
How does the body differ from the full candle range?
Body length is |Close − Open|, while range is High − Low. For valid OHLC, body plus both nonnegative shadows equals range. In the model those lengths are 20 and 40 pips. The identity alone does not validate malformed data.
Does a rising candle have to be green?
No. Colours are configurable, and the platform may compare with the previous Close rather than the current Open. Compare Close with Open directly to establish body direction; record the actual colouring rule separately.
Does a long candle establish what happens next?
OHLC alone does not establish that forecast. It summarizes the chosen interval’s endpoints and extrema. Range is not total travel or a guaranteed profit: entry, exit, quantity and costs remain unspecified.
How does a candle differ from an OHLC bar?
Both can display the same four prices. An ordinary OHLC bar uses a vertical High–Low line, a left Open tick and a right Close tick. A candle fills the Open–Close interval as a body. Check that the bar is not HLC mode, which omits Open.
Sources & bibliography
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Steve Nison / Penguin Random House Japanese Candlestick Charting Techniques, 2nd ed. (2001) · An introduction to Japanese candlestick charting for Western-market readers. www.penguinrandomhouse.com ↗
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Wikipedia Candlestick chart · Wikipedia overview reached via the Steve_Nison URL. This is not the original book text. en.wikipedia.org ↗
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BIS Triennial Central Bank Survey of Foreign Exchange Markets · The 2022 survey of foreign-exchange turnover. www.bis.org ↗
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TradingView Candlestick charts — price fields and colour settings · Documents body/shadow display and the alternative previous-Close colouring rule. The candle lengths and malformed-record counterexample here use fictional assigned data. www.tradingview.com ↗
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MetaQuotes MetaTrader 5 — Price Data in the Trading Platform · Distinguishes Bid-based OTC bars and Last-based exchange bars. Chart observations are not automatically executable order prices or a whole-market transaction record. www.metatrader5.com ↗
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TradingView Understanding bar charts — OHLC and HLC modes · Describes left Open/right Close ticks and the HLC option that omits Open. This is a display distinction, not a measured claim that candles are universally easier. www.tradingview.com ↗
