Heikin Ashi: Smoothing the Noise Out of the Candle
Heikin Ashi candles are built from averaged price data, not raw OHLC — which changes what a 'candle flip' actually tells you.
A standard candle plots the raw open, high, low, and close for a period. A Heikin Ashi candle plots a smoothed version: its close is the average of the current period's open, high, low, and close, and its open is the midpoint of the previous Heikin Ashi candle's open and close. The effect is a chart that filters out a lot of intra-period noise and makes trend direction visually obvious — long runs of same-colored candles instead of a mix of small red and green candles inside an uptrend.
What a 'flip' means
Because each Heikin Ashi candle's open is anchored to the previous candle, a color flip (red to green or green to red) is a more deliberate signal than it looks on a standard candle chart — it takes a real shift in average price action to flip the color, not just one noisy wick. HA Flip Bull/Bear setups watch for exactly this: the point where the smoothed trend actually changes character.
HARSI: RSI built on Heikin Ashi closes
HARSI is RSI calculated using Heikin Ashi closing prices instead of raw closing prices. Since Heikin Ashi closes are already smoothed, HARSI tends to produce cleaner, less jagged oscillator swings — which is why ChartWyz uses it (rather than standard RSI) for both the HARSI Crossup/Crossdown setups and the divergence setups.
The honest limitation
The averaging that makes Heikin Ashi easier to read also means its open/close no longer represent real, tradeable prices — you can't place an order at a Heikin Ashi price. It's a lens for reading trend character, not a substitute for the real candle when it comes to setting an actual entry, stop, or target.