Often this candle gaps lower as it makes a lower low. Small bearish/bullish candle: The second candle is a small candle – sometimes a Doji candle – that presents the first sign of a fatigued downtrend.At this point, traders should only be looking for short trades as there is no evidence of a reversal yet. Large bearish candle: The large bearish candle is the result of large selling pressure and a continuation of the existing downtrend.Establish an existing downtrend: The market should be exhibiting lower highs and lower lows.What is required, is an understanding of previous price action and where the pattern appears within the existing trend. Identifying the Morning Star on charts involves more than simply identifying the three main candles.
MORNING STAR CHART HOW TO
Morning Star Candlestick Pattern How to Identify a Morning Star Candlestick Pattern Traders should analyze the formation of a morning star and then seek confirmation that a reversal is confirmed using technical indicators. It reveals a slowing down of downward momentum before a large bullish move lays the foundation for a new uptrend. The Morning Star pattern is a three-candle, bullish reversal candlestick pattern that appears at the bottom of a downtrend.
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