How to Read Hollow Candlesticks

In the previous article, I walked you through the main differences between two popular candlestick charts based on the traditional candlestick chart and the Heikin Ashi chart. In this article, I will cover another candlestick chart: the hollow candlestick; then, I will show you how to create it with Highcharts Stock.

The demo below displays the AAPL stocks using a hollow candlestick chart type:

Hollow candlestick chart is a mixed concept between the traditional candlestick chart and the Heikin Ashi chart with a little extra. Like the traditional candlestick chart, the pricing data for each candle are independent of the previous candle pricing; however, the candle color is rendered following the previous pricing data. Now let’s check the little extra. Candles within the Hollow candlestick chart are hollow or solid, depending on how high or low the current close price is compared to the current open price. Here is a nice summary to understand how to read the hollow candlestick charts (check the demo below):

• Solid or Hollow
  • Solid candle if the current closing price is lower than the current opening price.
  • Hollow candle if the current closing price is higher than the current opening price
• Green or red
  • Green candle if the current closing price is higher than the previous closing price.
  • Red candle if the current closing price is lower than the previous closing price.

How to create a Hollow candlestick chart

Now that you know how to read the hollow candlestick charts, let’s see how to create it with Highcharts Stock. All you have to do is:

1. Add the highstock.js module

   <script src="https://code.highcharts.com/stock/highstock.js"></script>

2. Add the hollowcandlestick.js module

   <script src="https://code.highcharts.com/stock/modules/hollowcandlestick.js"></script>

3. Select the candlestick chart type type: hollowcandlestick

That is it; now you know how to read and create a Hollow candlestick.
Feel free to share your best candlestick charts and tips in the comment section below.