Candlestick Colors That Separate Intraday Direction from Close-to-Close Trend

Summary

Candle RM modifies the standard Japanese candlestick display by encoding two price comparisons separately. The candle body keeps the usual open-versus-close coloring, while the outline and wicks show whether the current close is higher than, lower than, or equal to the previous close. This makes the within-period move and the close-to-close direction visible together, including cases where they point in opposite directions.

The document motivates the design as a way to make direction easier to read during sideways movement or when consecutive closes are close, particularly for newer traders. It provides rules and an implementation example covering rising, falling, and unchanged closes alongside bullish, bearish, and doji bodies. The proposal is a charting aid, not a trading signal or tested strategy; it offers no evidence that the added visual encoding improves decisions or performance. Its color choices may also need adjustment for readability and accessibility.

Key ideas

• The candle body color represents the relationship between the current open and close.
• The outline and wick color represent the relationship between the current close and the previous close.
• The two color layers can show opposing intraday and close-to-close directions on one candle.
• The document provides display rules and sample logic but no evidence of trading performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.