The origin of candlestick charts

Interestingly, the history of Forex candlestick takes us to Japan, where the origin of candlestick charts date back to more than five hundred years ago. Japanese used them for the purpose of doing analyzing the rice markets. The technique evolved over time into the candlestick charts used in Japan and countless technical traders all over the world. Let us take a look into the Beginning of Japanese candlestick charts.

Throughout the Candlestick charts history, you will find many war-like references. The period between 15th and 16 the century in Japan saw a constant war between territories. This period of turmoil came to an end in the early 1600's under the combined leadership prowess of through three dynamic generals - Nobunaga Oda, Hideyoshi Toyotomi, and Leyasu Tokugawa.

The Start of Forex candlestick charts is seen in a military environment which persisted in Japan. Understandably, trading was seen as a battle where the investor should develop a strategy and aggressive maneuvers in order to win and make profits.

With the stability settling over Japan, during the early 17th century, new opportunities began to surface. With the local markets starting to expand to a national scale, this led to the growth of technical analysis in Japan. Osaka, the "Kitchen of Japan" with its vast system of warehouses, became the profit center of all Japan. The mid 1600's saw a number of merchants tried to corner the rice market. But they were not able to survive under the military government lead by the Shogun.

The Dojima Rice Exchange, was the first institutionalized market that was established in the late 1600's. Merchants now were able to grade the rice, and negotiated setting the market price. The rice warehouse receipts became known as rice coupons and were the first forms of futures. With the rice coupon becoming an actively traded entity, the Dojima Rice exchange became the world's first futures exchange.

It was during this period in the history of Forex candlestick, which saw the Forex candlestick charting becoming more refined. The basic analysis behind the Currency trading candlestick charts developed over the years is simply due to the tracking of rice price movements.

In the mid 1700’s, Homna , the youngest son of the Homna family, being extraordinary trading savvy, inherited the family's business. It was his research into historic price moves and weather conditions, establishing more concrete interpretations into what is known as Candlesticks. Homna’s trading abilities, based on Candlestick analysis, became legendary and he went on to amass greater fortunes in the Tokyo exchanges.

japanese candlestick analysis has been successfully used in Japan for hundreds of years. The Beginning of Japanese candlestick charts in US was only about 25 years ago. It became gradually popular in the U.S. trading community. Earlier, it didn’t generate any interest, as the perception was that it was difficult to learn and very time consuming. With the advent of computers and computer programming, there was no looking back for Forex Candlestick.

The success and interest in candlestick signal analysis in the United States has to be credited to a westerner by the name of Steve Nison. He studied the secret technique on how to read charts from a fellow Japanese broker. Literally living, breathing and eating candlesticks, over three years of extensive research by Steve produced his initial publication "Japanese Candlestick Charting Techniques” published in 1991.

Today, the Candlestick trading is helping millions of investors across the globe. The reason behind their great appeal is that the traders get to analyze the same data with a dramatically dynamic visual interpretation.