The candles of the pattern are ringed. An invented chart, drawn to show the shape. Not market data.
Also searched asmorning star candle · morning doji star · three candle reversal
How to recognise a morning star
- First: a long falling candle.
- Second: a small body, often with a gap from the first on markets that gap.
- Third: a rising candle closing above the middle of the first candle’s body.
What it is taken to mean
It is read as a fall running out of sellers, a pause, and then buyers taking control: night, then the morning star.
What traders check next
- How deep the third candle closes into the first. Deeper is given more weight.
- Whether the low of the middle candle rests on a known level.
- That all three candles have closed. Two-thirds of a morning star is not one.
Where people go wrong
- Anticipating the third candle before it has formed.
- Expecting gaps in a market, such as major currency pairs, that rarely gaps within a session.
- Forgetting that a three-candle pattern needs three times the patience.
Questions people ask
- Does the middle candle have to be a doji?
- No. Any small body will do. When it is a doji the pattern is called a morning doji star.
- Is the morning star reliable?
- No. It describes what buyers and sellers did during those candles. Studies of candlestick patterns find that, taken alone, they predict the next move only a little better than chance, if at all. It is one observation to weigh with others.
The words on this page
An explanation for study. It is not advice, a recommendation or a forecast, and a pattern or a situation described here says nothing certain about what a price will do next.