Morning Star and Evening Star Patterns

These three-candle patterns are among the most reliable reversal signals in candlestick analysis.

Morning Star Pattern


A bullish reversal pattern found at the bottom of a downtrend.

Structure

1. First Candle: Large bearish (red) candle confirming the downtrend
2. Second Candle: Small body candle (the "star") that gaps down, showing indecision
3. Third Candle: Large bullish (green) candle that closes above the midpoint of the first candle

What It Means

• Sellers are exhausted (first candle shows last push)
• Market reaches indecision (star shows balance)
• Buyers take control (third candle confirms reversal)

Trading the Morning Star

• Entry: After third candle closes
• Stop Loss: Below the low of the star candle
• Target: Previous resistance or 1:2 risk-reward minimum
• Confirmation: Higher volume on the third candle

Evening Star Pattern


A bearish reversal pattern found at the top of an uptrend - the mirror image of morning star.

Structure

1. First Candle: Large bullish (green) candle confirming uptrend
2. Second Candle: Small body candle that gaps up (the "star")
3. Third Candle: Large bearish (red) candle closing below midpoint of first candle

Trading the Evening Star

• Entry: After third candle closes
• Stop Loss: Above the high of the star candle
• Target: Previous support level

Variations

Doji Star

• When the middle candle is a doji (cross shape)
• Even stronger signal due to extreme indecision
• Called "Morning Doji Star" or "Evening Doji Star"

Abandoned Baby

• Gaps exist on both sides of the star candle
• Very rare but extremely reliable
• Strongest version of the star pattern

Improving Accuracy

Key Filters

1. Must occur at the end of a clear trend
2. Third candle should close above/below midpoint of first
3. Higher volume on third candle increases reliability
4. Look for the pattern at key support/resistance levels
5. Works best on daily and 4H timeframes

Common Mistakes

• Trading the pattern in a sideways market
• Not waiting for the third candle to close
• Ignoring the overall trend context
• Setting stops too tight

Practice Tips

1. Scan daily charts for recent examples
2. Note which timeframe produced the best results
3. Combine with support/resistance for confluence
4. Track your win rate with this pattern