Long Bullish Candle

The long bullish candle is the most bullish of all the candles. It represents a strong day of bullish activity and from the open to the close the price continues to rise. Sellers may come in during the day but not enough to stop the price from continuing its journey higher. Any time the sellers come into the trade the buyers will buy the security from them and continue pushing the price up. If this candle closes near the high then it is likely that more buying may take place on subsequent days as the buyers have not finished buying the stock and are just waiting for more to become available to push the price higher.

The Japanese term for this candle is the white marubozu. There is a slight difference between the marubuzo and the long bullish candle: The long bullish candle may have some of the wick exposed at both ends but a true marubozu has either the opening price equal to the low and the closing price equal to the high, or both leaving no wick.

Figure 1

One common feature of the long bullish candle (see Figure 1) is an open near the low and a close near the high which indicates buying has taken place throughout the day.

Figure 2 is an intraday chart of the price action that results in a long bullish candle on the daily chart. In this case the time period is for 1hr and each candle represents the price action for this sub-period of a day.

Figure 2

The opening price is near the low of the day and although there are periods where the price does fall it ends up near the high of the day. A classic long bullish candlestick has a long candle and no wick but this is quite rare, and candles with small wicks at either ends are considered to be long bullish candles.

Figure 2 shows that the bulls were in charge the whole day and this is borne out by the price moving higher over the course of the day and closing near the high of the day. During periods like this it is usually a good opportunity to buy on any pull backs as the markets don’t move in one direction without some sort of move in the opposite direction. This normal retracing of the price gives a chance to act on this bullish signal.