When trading price action or using candlestick. It is important to always wait for the bar/candle to close before place an entry. Many traders rush in entry during open candle when the price spike. That is not a good idea to place trade during open candle which are still in play.
The best way to trade is to wait for the candle to close. Once a candle has closed, it is final – it cannot ever be changed and it will always be that way. Must wait till the candle fully forms and closes. Once it does, it will always be like that forever and cannot be changed. This means the signal is clear and there are no changing components to it.
When the candle opens low and close high, that the best opportunity to buy on bullish candlestick and Sell on bearish candlestick when it open high and close low.
Each chart has its own time frame be it Daily, 4-hour, 1 hour, 30 minutes, 15 minutes, 5minutes and 1 minute. Each candle on any chart represents the time frame of that chart. So, a candle on a Daily chart represents one day, 24 hours of trading time.
Each candle on a 15 minutes chart, represents 15 minutes of trading time. At the end of the candle’s duration, let’s say 15 minutes on a 15 minutes chart, that 15 minutes candle is considered to be “closed” and a new candle immediately opens to right of it.
It is at that point that we would be able to use that just closed candle as part of our entry.
Until a candle is closed, we really do not know what kind of a candle it will ultimately turn out to be (bearish or bullish candle) or at what price level it will close. Therefore, we cannot decide to trade on an “open” candle.
As example is in the London open and close session as you will often see a strong push at the beginning and at the end of London Market session.
If the trading candle pattern is still forming, it is often recommended to wait for the candle to close because up till that point, anything can happen and the formation of the candle, price action and signal strength can change drastically.
Lastly, if something is strong into the close, once the candle closes, it often displays the final intentions of the market in the current move. Closes towards the highs/lows of a candle often indicate there is little profit taking so if you are trading in the direction of such a move, this can be a good confirmation sign.
However, if you are in a long position and the candle closes with a strong rejection/wick on the topside, the closing of that candle could be indicating the markets intentions to reverse it as price failed for that candle to maintain a strong high and close.
Take a look at the chart below when you trading using forex line indicator;
Candlestick close after breakout
When the candlestick breakout resistant or support.
It is better to wait the candle close after 15 minutes.
The best candle to entry on breakout is candle with open low and close high for buy and Candle open high and close low for Sell
Candlestick signal strength after closed
When the candlestick closed after 15 minutes on timeframe M15
It is better to check the signal strength every time after 15 minutes candle closed
If the signal strength below 50%, it is better to close the open trade
As long as signal strength still above 50% after candle closed you may keep the open trade