Candlestick formation

Doji is a name of candlestick in Japanese Candlestick charting. Doji is one of the many types of patterns that give implication to the future price actions, and Doji simply means a formation in which the open and closing price are the same.

Over here, we are going to take a look of Morning & Evening Star and Morning and Evening Doji Star.

Morning Doji Star - Bullish
This is a major bottom reversal pattern on a Japanese Candlestick chart; the first day is a downtrend with a long red real body. The second day open lower with a small trading range - A Doji. The third day is a green candlestick that closes above the midpoint of the first day's real body.

Evening Doji Star - Bearish
This is a major top reversal pattern on a Japanese Candlestick chart; the first day is a long green body. The second day open higher with a small trading range - A Doji. The third day is a red candlestick that closes below the midpoint of the first day's real body.

Morning Star - Bullish
Morning Star is a 3-candlestick formation that signals a major bottom. The first day is a downtrend with a long red real body. The second day gap lower with a small real body to form a star, and the third day is a green candlestick that closes above the midpoint of the first day's real body. It is quite similar to Morning Doji Star except for the second day's body is wider, can be red or green.

Evening Star - Bearish
Evening Star is a 3-candlestick formation that signals a major top. The first day is a uptrend with a long green real body. The second day gap upper with a small real body to form a star, and the third day is a red candlestick that closes below the midpoint of the first day's real body. It is quite similar to Evening Doji Star except for the second day's body is wider, can be red or green.

We have a list of stocks in NYSE and NASDAQ that we scan for the above candlestick formations and post the results here everyday. Do come back here and check out more often.

The reliability of the candlesticks formation above are very high but as in other chart analysis, confirmation with other analysis is still needed to make sure that you enter the market at the right time.