## Understanding Candlestick Charts: The Foundation of Technical Analysis

For crypto traders, candlestick charts are an indispensable analysis tool. Each individual candle conveys four crucial pieces of information about the price movement during a specific period—whether it’s minutes, hours, or days.

**The four components of a candle:**

At the beginning of the period, the opening price is set. At the end of the same period, the closing price is shown. During this interval, the price reaches its highest (High) and its lowest (Low). These four values form the basic structure of each candle in the chart.

**Colors as signals:**

The coloring of the candles has a clear meaning: green candles indicate an upward movement—the closing price was above the opening price. Red candles, on the other hand, suggest a downward movement—the closing price was below the opening price. This visual distinction allows for quick recognition of price changes at a glance.

**Why candlestick charts are so valuable:**

Mastering candlestick analysis is the first essential step to successfully applying technical analysis. [$BTC](/de/trade/BTC_USDT?contentId=23703023647914) and other digital assets can be systematically analyzed and understood using this method.

[#candlestick_patterns](/de/square/hashtag/candlestick_patterns) [#learncandlestick](/de/square/hashtag/learncandlestick) [#CandlePatterns](/de/square/hashtag/CandlePatterns)