What's Heikin Ashi?

Heikin Ashi? 🤔

Alright, fam, you prob already vibin’ with the big three chart types: the line chart, the bar chart, and the oh-so-classic candlestick chart.

But hold up, there’s another chart in the game using a totally rad method to show off the price moves. 📊💥

Enter the Heikin Ashi.

Like the beer? Nah fam. 🍻

Nah fam, stay focused. We ain't talkin' brewskis here!

We’re diving into CHARTS! (Although it does sound a bit similar. 🤨)

“Heikin Ashi”, aka “Heikin-Ashi” or “Heiken Ashi” is a technique for charting like a pro that’s kinda, sorta, maybe, like a classic Japanese candlestick chart. 🎌

The twist is all in how you calculate and plot those candlesticks on your chart. 📈✨

Your usual Japanese candlesticks? They’re bangin’ for finding sweet entry spots since they show possible reversals (like a shooting star) or breakouts (like a bullish marubozu above resistances).

But what happens when you're already in the game? 🤔

Using the Heikin Ashi style on your chart helps decide if you should keep rollin’ with it or bail.

Heikin Ashi charts make candlestick charts clearer for traders who wanna know when to stick with a trend and when to dip. 📉💨

Basically, Heikin Ashi is a spiced-up candlestick technique that switches up how price is shown so trend chasers can feel mega-confident deciding to ride or peace out. 🚀

Some traders, usually the long-haul folks, pick Heikin Ashi charts as an option to the classic Japanese candlestick charts.

Other traders mix 'em with those OG Japanese candlestick charts, swapping back and forth like a pro DJ. 🎧

What is Heikin Ashi?

In Japanese, Heikin is “average” and Ashi is “pace”. So together, Heikin Ashi means the “average pace of price”. 🏃‍♂️💨

Heikin Ashi is a type of candlestick charting trick used to chill out market noise.

This trend was kickstarted ages ago by Munehisa Homma, the rice market mogul from Sakata, Japan, who’s like the Yoda of candlestick charts. 🌾📜

So, if Darth Vader is Luke’s daddy, then Munehisa Homma is the papa to Heikin Ashi. 👨‍👦

Homma figured that by following price moves in the rice scene, he could low-key scope the vibes of other peeps in the market and use it to his advantage. 😎

Check out a slice of a Heikin Ashi chart:

To the untrained eye, this chart kinda looks like your average Japanese candlestick chart.

Every Heikin Ashi candlestick has a body and could have an upper or lower shadow (or wick).

Same vibes, right?

Nah, not quite.

The difference is MAJOR between these two candlestick chart styles. Let’s uncover why. 🔍✨