A candlestick analysis is a technical analysis used to determine the price movement of the stocks/securities.
Candlestick charts have been developed in the 18th century by Munehisa Homma, Japanese rice trader of financial instruments.Candlesticks are usually composed of the body , and an upper and a lower shadow (wick). General forecasting duration for candlestick analysis is one week. Candlestick analysis can be used by short term traders (i.e. weekly). In the candlestick view, after significant rise or fall, when the previous day body is completely covered by today’s body with the reversal color and significant volume, then it can be identified as engulfing pattern. It can be of two types, i.e. bullish and bearish engulfing pattern. There are other patterns such as Piercing pattern , Doji pattern , Hammer and hanging man patterns which basically indicate trend reversal from the prevailing pattern.