What a long wick on a wide-spread candle actually is
Posted: Sat Oct 31, 2026 8:01 am
A candle with a spike wick of 6 pips in a dead minute usually draws the question "who got stopped out?" Often the honest answer is: nobody did, because it was the spread.
Platform charts are normally drawn from the bid price. When liquidity thins, the spread can jump from 0.8 to 4 or 5 pips for a few seconds, and in some situations the bid itself drops as quotes are repriced, so the bar shows a long wick that no real volume traded through. Meanwhile, anyone short with a buy stop would have been filled off the ask, which is a different price from what the chart shows.
That cuts both ways. A stop that did not trigger on a bid-based chart may have been hit on the ask. A target that looked touched may not have been available at that price. Backtests that fill at the chart price will count wicks like this as free wins and free losses.
Practical check: if the platform allows, display the ask line on the chart and overlay both. Then look at where wicks coincide with spread expansions rather than genuine moves. Filtering those bars out in testing makes results noticeably more honest.
How often did your stop-outs come in on a wick that shows no real trading on the chart?
Platform charts are normally drawn from the bid price. When liquidity thins, the spread can jump from 0.8 to 4 or 5 pips for a few seconds, and in some situations the bid itself drops as quotes are repriced, so the bar shows a long wick that no real volume traded through. Meanwhile, anyone short with a buy stop would have been filled off the ask, which is a different price from what the chart shows.
That cuts both ways. A stop that did not trigger on a bid-based chart may have been hit on the ask. A target that looked touched may not have been available at that price. Backtests that fill at the chart price will count wicks like this as free wins and free losses.
Practical check: if the platform allows, display the ask line on the chart and overlay both. Then look at where wicks coincide with spread expansions rather than genuine moves. Filtering those bars out in testing makes results noticeably more honest.
How often did your stop-outs come in on a wick that shows no real trading on the chart?