In the previous article, we’ve learned Japanese Candlestick Pattern Morning Star. Now, we’ll see another type of same pattern, known as Japanese Candlestick Pattern Evening Star.
Japanese Candlestick Pattern Evening Star
The Evening Star is the bearish counterpart of the Morning Star pattern. The Evening Star is a reversal pattern that is emerging at the end of an uptrend. The following chart shows an example of an Evening Star pattern:
- The first candlestick has a strong bullish body.
- The second candlestick has a small body. He can be bullish or bearish. It is also possible that the second candlestick has no body at all (a Doji).
- The third candlestick has a strongly bearish body and closes at least within the first candlestick or even below the middle of the first candlestick of the formation.
There is another type of Japanese Candlestick – Morning Star which also shows the reversal of direction.
- Morning Star and Evening Star are reversal formations.
- The first candlestick follows the direction of the trend.
- The second candlestick can be bullish or bearish and has a small body that reflects the indecision in the market.
- The third candlestick follows the direction of the reversal and preferably closes over (morning star) or below (evening star) the middle of the first candlestick.