Candlestick chart doesn't seem to make sense

Question

chart

This is a candle stick chart I saw in the market. The question is about the part I annotated. In the red bar, it opened at the top of the rectangle and closed at the bottom of the rectangle. How come the green bar that comes next does not open at the same price the previous bar was closed? Instead it opens at a random location.

chart investing

Fattie · Answer

Welcome new user, it's
Just bad data.
This actually gets asked a lot on here.
It's just bad data. There's nothing more to it than that.
However,
Do note that if this is a thin market,
It is perfectly possible that is a gap.
Don't forget one of the actual ideas of candlesticks is to easily observe gaps. Imagine more typical candles, which show one entire session of trading.  (ie one day == one candle.) It's perfectly normal the open on Thursday is quite different from the close on Wednesday.
If your chart is of a thin market (imagine say "one trade per minute") it's completely normal to see what you see.
If you want to "trade candlesticks" I truly urge you to read the actual original book on the matter, the first translation of the original Japanese.
(I no longer give out the name of the book/author since if anyone is that unmotivated, better pedagogy to fail fast :/ )
Good luck!

Candlestick chart doesn't seem to make sense

One Answer

Just bad data.

It is perfectly possible that is a gap.

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