đ Understanding the Morning Star Pattern in Trading
đ What is the Morning Star Pattern?
The Morning Star is a bullish reversal candlestick pattern.
đŻď¸ Structure of the Morning Star (3-Candle Pattern):
â˘First Candle â Strong Bearish Candle (red):
Shows that sellers are still in control and pushing prices lower.
â˘Second Candle â Small Candle (red or green):
A sign of market indecision. Could be a doji or spinning top.
â˘Third Candle â Strong Bullish Candle (green):
Closes well above the midpoint of the first candle, showing buyers are taking over.
It appears after a downtrend and suggests the price may start rising soon.
It's like a sunriseâa fresh start after a dark night (bearish trend).
đ What the Morning Star Tells You:
The selling pressure is fading.
â˘Buyers are stepping in with strong momentum.
â˘A trend reversal from bearish to bullish is likely.
â Beginner Tips:
â˘Look for this pattern at the bottom of a downtrend.
â˘A stronger signal if the third candle has higher volume.
â˘Combine it with support zones, RSI, or trendlines for extra confirmation.
đ Example:
Letâs say Ethereum has been falling for several days:
Day 1: Big red candle â Sellers dominate.
Day 2: Small candle (could be red or green) â Market is unsure.
Day 3: Big green candle â Buyers take control.
Thatâs a Morning Star â the downtrend might be ending, and an uptrend could begin! đ