Creating a candlestick chart

A candlestick chart is a type of financial graph, used to describe a given security’s price movements. A single candlestick (typically corresponding to one day, but a different frequency is possible) combines the open, high, low, and close (OHLC) prices.

The elements of a bullish candlestick (where the close price in a given time period is higher than the open price) are presented in Figure 3.15:

Figure 3.15: Diagram of a bullish candlestick

For a bearish candlestick, we should swap the positions of the open and close prices. Typically, we would also change the candle’s color to red.

In comparison to the plots introduced in the previous recipes, candlestick charts convey much more information than a simple line plot of the adjusted close price. That is why they are often used in real trading platforms, and traders use them for identifying patterns and making trading decisions.

In this recipe, we also add moving average...