What is a Dildo?
In finance, the meaning of “dildo” refers to "long green candle" and "long red candle" seen on charts of assets. They refer to the visual representation of price movements in a financial chart, typically a candlestick chart. A candlestick chart is a type of financial chart that is used to represent price movements for an asset, such as a stock, commodity, or currency.
A long green candle in a candlestick chart represents an upward price movement for an asset. The long green candle is typically made up of a body, which represents the difference between the opening and closing prices for the asset, and an upper and lower shadow, which represent the high and low prices for the asset during the time period being represented. If the body of the green candle is long, it means that the price of the asset moved significantly higher over the time period being represented.
A long red candle in a candlestick chart represents a downward price movement for an asset. The long red candle is also made up of a body and an upper and lower shadow, with the body representing the difference between the opening and closing prices for the asset. If the body of the red candle is long, it means that the price of the asset moved significantly lower over the time period being represented.
The length of the green and red candles in a candlestick chart can be used by traders to gauge the strength of price movements for an asset. If a long green candle appears in a chart, it may indicate that buyers are aggressively bidding up the price of the asset. Conversely, if a long red candle appears in a chart, it may indicate that sellers are aggressively selling the asset, causing the price to drop.
Simplified Example
Think of a long green or red candle like a measuring stick. When you're measuring how tall you are, you stand up straight and hold the measuring stick next to you. If the measuring stick is longer than you, that means you grew taller. If it's shorter than you, that means you shrunk.
In the same way, when you're looking at a long green or red candle on a financial chart, it's like a measuring stick for the price of a stock or other asset. If the candle is green and long, that means the price of the stock went up a lot. If the candle is red and long, that means the price of the stock went down a lot.
Just like when you measure your height, you can use the length of the green or red candle to see how much the price of the stock changed. The longer the candle, the bigger the change in price.
History of the Term Dildo
The term "dildo" in finance likely originated sometime in the late 1990s or early 2000s, coinciding with the rise of online financial forums and the increasing informalization of communication within the financial community. It emerged as a slang term used by traders and investors to describe a sudden and sharp price movement, particularly a bullish reversal pattern characterized by a long green candle followed by a gap higher. The visual resemblance of this pattern to a dildo, combined with the connotations of growth and penetration associated with the object, likely contributed to the term's adoption. While the exact origin remains unknown, "dildo" has become a widely recognized term within the financial community, although its use remains largely informal and humorous.
Examples
Green Dildo: In finance, a long green candle refers to a candle on a stock chart that has a large real body and a small or nonexistent upper shadow, indicating a bullish trend. A long green candle indicates that the stock's price opened at a low price, rose throughout the day, and closed at a high price, with relatively little selling pressure. A long green candle is often seen as a positive sign, as it suggests that the stock's price has risen significantly, and that the bullish trend is likely to continue.
Red Dildo: In finance, a long red candle refers to a candle on a stock chart that has a large real body and a small or nonexistent lower shadow, indicating a bearish trend. A long red candle indicates that the stock's price opened at a high price, fell throughout the day, and closed at a low price, with relatively little buying pressure. A long red candle is often seen as a negative sign, as it suggests that the stock's price has fallen significantly, and that the bearish trend is likely to continue.
Related terms
Day Trading: Day trading is a way of buying and selling assets quickly in order to make a profit. It's like going to a store, buying something, and then turning around and selling it for more money.
Volatility: Volatility in finance is a measure of the amount of uncertainty associated with the size of changes in a financial market.