![]() The first Doji signifies the indecision between the bullish and bearish forces and is kind of an equilibrium between the two. Tristar formations are those patterns where three Doji are formed on three consecutive trading days. Just after this pattern is detected on the chart, one can see a trend reversal and the beginning of a long bearish phase. In the chart below, one can see that after a long uptrend, this pattern is formed which has been marked with red colour. ![]() Now, let us see how a Doji star bearish candlestick pattern looks like in a real chart. In order to sell after the formation of this pattern, one should remember that the closing of the new candle of Doji star bearish candlestick pattern should be below the low price of the first candlestick as this is the true sign and confirmation of trend reversal. One should check 5 minute and 15 minute time frames to check for this pattern and take positions accordingly. A stop loss is triggered if the prices go up instead of going down in the next two days. In case of a Doji Star Bearish Candlestick Pattern, one should initiate a trade on the short side.Īfter initiating the trade, stop loss should be fixed at the higher of the last two days high price. This is the pattern which suggests that a trade should be initiated in the opposite direction of the existing trend. This is the sign of a trend reversal and this is how a Doji Star Bearish Candlestick Pattern is formed. And the closing price should be below the midpoint of the gap between the closing price of the candle formed on the first day and the opening price of the candle on the second day. On the next day, the third candlestick should show a gap down opening. One should note that a small Doji should be formed on the second day which means that the high and low prices should not be too far away from the opening and closing price. This signals that after the long run of the bulls, there is a pressure building up from the bears as well because of which the Doji is formed. On the next day, the stock should have a gap up opening and a Doji is formed showing that the closing and the opening price are almost the same. The image in the picture posted below shows a bullish marubozu candlestick (and a bearish marubozu candlestick). There are no upper and lower shadows in the candlestick charts. There is one more possibility of the appearance of Doji star bearish candlestick pattern which is that the first candlestick can also be a bullish marubozu candle.Ī bullish Marubozu candle means that the opening price of the stock is the low price of the day and the closing price is the high price of the day. The first image of the picture pasted below shows a normal green type of candlestick chart followed by a small Doji. It should be a green candlestick on the first day confirming the uptrend and showing that the closing price of the security is greater than the opening price. Let us find out how we can detect this pattern to initiate a trade. Please refer to the picture below to see different types of Doji that can be formed:ĭoji Star Bearish Candlestick Pattern is seen in an uptrend and generally signs the reversal of the trend. The upper and lower shadows of the candle are very much visible giving it the shape of a Doji. Due to this, a Doji pattern looks like a cross in which the body of the candlestick is either very small or almost nonexistent. ![]() It means that in a trading session, the open and closing price of a stock has been virtually the same. To understand this term thoroughly, one should be able to understand the meaning of “Doji” first. Let us first try to understand what exactly is the meaning of Doji Star Bearish Candlestick Pattern, how and when is it formed along with the help of an example later. ![]() This generally happens after a long uptrend has been witnessed in stock price. Doji star bearish candlestick pattern is a trading pattern that is used in technical analysis of stocks for determining the trend reversal stage.
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