Candle Structure
Candle Structure decomposes each candle into body and wick percentages, giving a numerical read on conviction (large body, small wicks) versus indecision (small body, long wicks) without relying on named patterns.
What it measures
For every candle, the indicator computes body % (|close − open| ÷ total range), upper wick % ((high − max(open, close)) ÷ range), and lower wick % ((min(open, close) − low) ÷ range). These three percentages sum to 100 and describe the candle's internal balance.
Parameters
| Name | Default | Range | Note |
|---|---|---|---|
| body_threshold | 70 | 50–90 | Body percentage above which the candle is considered "conviction". Higher values catch only very strong candles. |
| wick_threshold | 50 | 30–80 | Single-wick percentage above which the candle is considered a rejection at that end. |
How it behaves
High-body candles at trend continuation levels indicate the move has real participation. Long lower wicks at support and long upper wicks at resistance indicate rejection — the failed attempt to break the level has been mapped into the candle's anatomy. Small-body candles (dojis, spinning tops) mark indecision and often precede transitions.
When it misleads
A single candle is a small sample of trading activity, and body-to-wick ratios can flip completely between two adjacent bars without much market change. Filter on context — a rejection wick at a random price is noise; the same wick at a validated support level is a signal. Also beware timeframe compression: a five-minute rejection is not the same event as a daily rejection, even though the ratios look identical.
Backtest result
Sourced backtest in preparation — we're running the rule on our own historical candles before publishing numbers we can stand behind.
FAQ
- What percentage body defines a "marubozu"?
- A pure marubozu has 100% body (no wicks). Traders commonly relax this to 90%+ body with negligible wicks — the point is the candle showed no rejection at either end.
- How is candle structure different from candlestick patterns?
- Named patterns (hammer, engulfing, doji) are specific configurations. Candle Structure is the underlying vocabulary — every named pattern is a specific arrangement of body and wick percentages across one or more candles.
- Which timeframes work best?
- Daily and 4-hour candles carry the most information per bar — they aggregate more trading activity, so their body/wick ratios reflect real conviction. Below 15 minutes the ratios flip too fast to be reliable on their own.
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