Wick
What does the thin line beyond a candle's open and close tell a trader about where price went and came back from?
In plain words
A wick is the part of a price candle that extends past the open and close, marking the highest and lowest prices reached during that period before the price settled back inside that span.
Why it matters
A long wick shows that price travelled somewhere and was pushed back, revealing how much of a move did not hold. For anyone carrying risk, the length of wicks relative to the candle body helps show whether a level was tested and rejected or sustained.
In a real week: BTC, week of 28 February 2022
In the week of 28 February 2022, BTC opened at 37699.08 and closed at 38420.81, while reaching a high of 45400.00 on Wednesday at 15:00 UTC and a low of 37450.17 on Monday at 00:00 UTC. The open sat 0.66% above the week's low and 20.43% below the week's high, so the stretch upward was far longer than the one downward, yet the close finished 12.2% of the 21.23% range from the low, in the lower third.
A common mistake
Reading a long wick as a forecast in itself. It records where price was rejected in the past, and the next candle can extend or ignore that level entirely.