A candle where the open, high, low and close are all the same price, usually a sign of no real trading rather than a signal.
All four ohlc values are identical, so the candle prints as a single horizontal line. It occurs in illiquid instruments, in pre-market or overnight periods with almost no activity, and on very low timeframes in thin names.
It is almost never a meaningful pattern. It is a data condition telling you there was no liquidity during that period.
Their presence is a warning about the instrument itself. A daily chart peppered with four-price doji means wide bid-ask-spreads, poor fills and unreliable indicator readings. Any backtesting on such an instrument will look better than live results because a backtest assumes you can trade at prices that never had size behind them.
Original diagrams for the ideas on this page. Illustrative, not real market data.
The bid-ask spread. Buy orders sit below, sell orders above, and the gap between the best bid (50.01) and best ask (50.04) is the spread you pay to cross. Bar length shows the size resting at each price.The parts of a candlestick. One candle sums up a slice of time: the thick real body runs from the opening price to the closing price, and the thin wicks reach out to the highest and lowest prices traded. Colour tells you which way the body ran.
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