The Japanese candlestick chart is one of the most important charts in the Forex trading market. People who are able to perform candlestick analysis and candlestick interpretation accurately will be able to find profitable Forex signal and succeed through the Forex Signal Trading System because they can understand the current market trend and competition.

The Japanese candlestick chart was used by the Japanese in rice trading back in the 17th century. In 1900, a person called Charles Dow brought this idea to the western countries. And since then, this chart is being widely used in the Forex market.

I learned the information below from a free 7 days Forex course from this Forex Mentor website. The Japanese candlestick chart is formed by 2 different candlesticks - hollow (white color) and real body (black color). Each body will have an upper and lower shadow which indicates the high and low price.

In candlestick interpretation, a hollow body means that the close price is higher than the open price. While on the other hand, a real body means that the close price is lower than the open price.

A very long upper shadow means that the price of the currency pair before close is very high, but when it is near to close, the sellers drive the price lower. This means that the sellers are coming in and are starting to take over the market. Using your imagination and logical thinking, you should be able to understand the current market situation, who is the winner and who is the loser through the Japanese candlestick analysis.

In the later stage of Japanese candlestick analysis, you will require to learn and read specific candlestick indicators. These indicators are derived from logical thinking and logical analysis of the basic Japanese candlestick interpretation. Some people who are lazy choose to use Forex trading software such as Forex Killer that is developed by a Forex expert called Andreas Kirchberger to help them in more advanced analysis.

There are different jargons for different indicators such as hangman, shooting star, engulfing pattern et cetera. However, I personally do not waste my time to memorize all these jargons because I only want to know how to read the Japanese candlestick chart.

In my opinion, I believe in the theory of "practice makes perfect". By reading the chart and analyzing the chart deeper (squeeze out all your brain juice!), you can understand the current market competition through candlestick analysis without knowing all those jargons and indicators.