So I’ll go ahead and firstly introduce myself since I think this is one of my first posts on this site.
My name is Paul and I’m a total forex noob. Nice to meet you all!
(I think there is an introduction section and I should probably go ahead and do that soon.)
Anyways, I’ve been going through the Pips School of Pipucation (I tried), and I’ve been doing ok, so far I think.
I just have a simple noob question for the time being - When someone says “Highs” or “Lows”, are they referring to the close of a Bullish or Bearish Candlestick or are they referring to the tops and bottoms of the “shadows” or “pins” that protrude from the body?
Hi, good to see you’re studying at the school.
Probably best if you wait until you get to this in the school, it will explain it really well. Basically, if you look at a chart you’ll see a series of peaks and troughs, bit like a mountain range. The highs are the mountain peaks, the lows are the troughs.
When you can see each consecutive peak is higher than previous peaks and the troughs are also higher, then the chart is trending upwards. If the opposite is happening then the trend is downwards.
Keep studying, don’t skip anything, keep asking questions.
Good luck
They’re referring to the pins/shadows that protrude.
The “high” of any specified period (such as a candle-duration) means simply “the highest point that the price reached during that period”. (And the same for the low, of course.)
That means that (unless a candle doesn’t have an upper wick at all because its high happened to coincide with the open if it’s a falling candle or its close if it’s a rising candle), the high will be the top of the [B]wick[/B], [B]not[/B] part of the body of the candle. (And the opposite for the low, of course.)
The highs and lows are entirely distinct from the opens and closes. The highs and lows are “absolute” in the sense that they’re objective and monitorable and factual and they’re simply “what levels the price reached”. The opens and closes are far, far less significant, and how they appear on people’s charts are about the periodicities with which people have set up their charts.
Think about what a “10-minute candle” is [I][U]actually[/U][/I] showing you. If you chose - for whatever reason (and there [U]are[/U] some reasons that some traders choose to do this: it isn’t just a theoretical point!) to start your 10-minute candles off at 5 past the hour, instead of [U]on[/U] the hour, the opens and closes shown by the candles would all be completely different from those on the chart of someone whose 10-minute candles started on the hour, wouldn’t they? But the highs and lows would still be in all the same places, because those [U]aren’t[/U] an arbitrary artefact of “charting”: they’re a reflection of “where the price was”, and they’re [B]objective[/B]. This key point, unfortunately, isn’t explained in the “school” pages.
This is why highs and lows are generally more important than opens and closes (there are also a couple of little exceptions, but they’re not relevant to this conversation).
And it’s also why (especially for beginners) “bars” are more helpful than “candles”: it’s true that bars and candles give exactly the same information (the high, the low, the open and the close), but candles visually emphasise the opens and closes, whereas bars visually emphasise the highs and the lows.
Don’t imagine that “candle patterns” are intrinsically easier to interpret than “bar patterns”, or contain more information than bars. That’s [B]not[/B] true at all. The people who imagine that are just people who originally learned to read candles rather than reading bars, and are more used to them.
something not mentioned, and should be taking into account.
When you see ANY Type of bar, or pin, the true high isnt shown. On chart they are short the difference of median of Bid and Ask price. Not Very many traders take that into consideration. As to why you have High and Low ZONES, and not the actual price from end point to end point.
Another reason why expert advisers fumble the ball in range trading.