What Is Morning Star?
A Morning Star is a three-candle bullish reversal pattern: a long bearish candle, followed by a small-bodied indecision candle (sometimes a doji), followed by a long bullish candle that closes well into the body of the first. The pattern typically forms at the end of a downtrend.
The middle candle represents seller exhaustion — neither side gained ground despite the prior bearishness. The third candle confirms the shift, with buyers driving a strong recovery. Gap-down on the middle candle and gap-up on the third strengthens the signal.
Common entry: long on the close of the third candle or on a confirming pullback. Stop-loss below the low of the middle candle. The pattern is among the more reliable candlestick reversal signals, particularly when it appears at a confluence with support levels or oversold RSI.
Related terms
- Evening Star — Three-candle bearish reversal pattern marking a potential top.
- Doji Candlestick — A candlestick where open and close are nearly equal — indicates indecision in the market.
- Candlestick Chart — Price chart format where each candle shows open, high, low, and close for a period.
- Support and Resistance — Price levels where buying or selling pressure historically halts price movement.