A Shadow in a candle stick pattern refers to the thin lines that extend above and below the main body of the candle. The top shadow, also known as the upper shadow or wick, represents the highest traded price of a security during the period represented by the candle. The bottom shadow, also known as the lower shadow or tail, represents the lowest traded price of a security during the period represented by the candle.Shadows are important in candle stick analysis as they provide information about the market sentiment during a specific period.For example, a long upper shadow on a bullish candle can indicate that there was significant selling pressure during the period, despite the overall bullish sentiment. Similarly, a long lower shadow on a bearish candle can indicate that there was significant buying pressure during the period, despite the overall bearish sentiment.Shadows can also be used in combination with the main body of the candle to identify different cand stick patterns such as the Hammer, Inverted Hammer, Shooting Star, and Hanging Man. These patterns can be used to signal potential trend reversal or continuation.It's important to note that the length of the shadow can indicate the strength of the buying or selling pressure, but it is not the only factor to take into account when interpreting cand stick pattern. Traders and investors should use cand stick pattern in combination with other technical analysis tools and methods, and consider the overall market context before making any investment decisions.
