Whiskers

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Whisker is the term given to denote the vertical lines that extend above and below the core boxes or bars on a graph of a financial product, asset, or security. These charts are often referred to as candlestick charts and the lines may also be expressed as wicks.

Each candlestick bar or segment of the chart will typically contain a solid box (candlestick body) - formed according to the opening and closing prices - along with two whiskers/wicks that extend above and below the core box. The whiskers represent the highest and lowest point recorded within that period.

Typically, if the box and whiskers are red (or black), it means that the price of the underlying asset fell during that time period, and if the box and whiskers are green this means the price rose during this period.

The whiskers extend to the upper and lower limits that the price of the underlying asset hit during the time segment, whereas the box or candle denotes the opening and closing price of the asset during that period. Small whiskers indicate that the highest/lowest price is close to the opening/closing price, whereas big whiskers indicate that the market experienced higher levels of volatility, moving further away from the opening/closing prices.

For example, if we are viewing a chart with a 10-minute segment per candle and the price opens at $5, falls to $1, rises to $15 and closes the 10-minute timeframe at $10, this would be expressed as a green candle with a whisker from $1 (lowest price during the period) to $5 (opening price), a solid green body candle from $5 (opening price) to $10 (closing price), and finally a whisker from $10 (closing price) to $15 (highest price).

Therefore, whiskers are a good way of gauging the volatility of an asset during a time period, above and beyond the opening and closing price for the timeframe.

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