How Do You Use Heikin Ashi Charts?
Now that you understand how Heikin Ashi candles are calculated, let’s talk about how to actually read and use them in your trading.
The main goal of using Heikin Ashi is simple:
👉 To filter out market noise and reveal the true trend.
Since these candles are calculated using averages, they smooth out choppy price movements—making it easier to spot whether a trend is forming, continuing, or weakening.
🔍 Why Use Heikin Ashi?
Because of how they're calculated, Heikin Ashi candles tend to have smaller wicks than traditional Japanese candlesticks.
That’s important because:
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Shorter shadows (wicks) = Stronger trend
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Longer shadows = Potential trend weakening or reversal
Here’s the basic idea:
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Green candles with no lower shadow = Strong uptrend
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Red candles with no upper shadow = Strong downtrend
These visual cues help traders quickly assess both trend direction and trend strength.
📈 Using Heikin Ashi to Spot Trend Direction
Color tells the story:
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Green candles = Price is trending up
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Red candles = Price is trending down
By simply looking at the color of the candles, you can tell at a glance which way the market is moving.
💪 Using Heikin Ashi to Measure Trend Strength
This is where things get interesting.
Take a closer look at the shadows:
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Strong uptrend → Green candles with no lower wick
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Strong downtrend → Red candles with no upper wick
The absence of a wick in the opposite direction signals strength. These candles show momentum without hesitation—no pullbacks, no pauses.
🪒 Enter: Shaved Candles
Candles with no wick on one side are often referred to as “shaved candles.”
There are two types:
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Shaved Bottom = No lower wick
Also called a “shaved tail” (or jokingly, a “shaved butt” 😆).
This usually appears in a strong uptrend. -
Shaved Head = No upper wick
Appears during a strong downtrend.
While technically the color of the candle doesn't matter when identifying shaved candles, in Heikin Ashi charts, the context does:
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We want green shaved bottoms in an uptrend.
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And red shaved heads in a downtrend.
These are powerful signals that the trend is strong and likely to continue—perfect for trend-following strategies.
🎯 Summary
Use Heikin Ashi charts to:
✅ Identify the direction of the trend (based on color)
✅ Gauge the strength of the trend (based on wicks)
✅ Stay in trades longer by avoiding the noise seen in traditional candlestick charts
If your goal is to catch trends and ride them confidently, Heikin Ashi can be a game-changer.