📘 Trading from Scratch – Day 17/90
⭐ Star Pattern: Morning Star and Evening Star
After studying the Doji Pattern, we will learn another of the most widely used trend reversal patterns in technical analysis: the Star Pattern.
This pattern can appear in both bullish and bearish scenarios and is made up of three Japanese candlesticks. Its interpretation depends on the context in which it appears.
Remember that no pattern guarantees future price behavior. It is always recommended to combine it with support, resistance, volume, and proper risk management.
🌅 Morning Star
What is it?
The Morning Star is a three-candle pattern that usually appears after a bearish trend.
Its structure is:
1️⃣ First candle: bearish with good momentum.
2️⃣ Second candle: small (it can be a Doji or a reduced-body candle), reflecting indecision.
3️⃣ Third candle: bullish with a strong close, showing that buyers regain control.
What does it represent?
📉 Sellers dominated the market.
⚖️ A pause or equilibrium appears.
📈 Buyers take control.
It may indicate a possible price recovery.
🌇 Evening Star
What is it?
The Evening Star is also made up of three candles, but it usually appears after a bullish trend.
Its structure is:
1️⃣ First candle: bullish with good momentum.
2️⃣ Second candle: small (Doji or reduced body), showing indecision.
3️⃣ Third candle: bearish with a strong close, indicating greater selling pressure.
What does it represent?
📈 Buyers dominated the market.
⚖️ A pause or equilibrium appears.
📉 Sellers regain control.
May indicate a possible loss of strength in the uptrend.
Quick comparison
🌅 Morning Star
🌇 Evening Star
Previous trend: Bearish
Previous trend: Bullish
Possible scenario: Recovery
Possible scenario: Weakness
Buyers take control
Sellers take control
Look for bullish confirmation
Look for bearish confirmation
Common mistakes
❌ Trade only based on the pattern.
❌ Ignore the previous trend.
❌ Don’t wait for confirmation.
❌ Do not use a Stop Loss.
❌ Don’t analyze the market context.
Best practices
✅ Wait for a confirmation candle.
✅ Analyze support and resistance levels.
✅ Combine the pattern with volume or other indicators.
✅ Maintain proper risk management.
Conclusion
The Star Pattern helps identify possible shifts in balance between buyers and sellers.
The Morning Star can appear after a decline and suggest a possible recovery.
The Evening Star can appear after an up move and suggest a possible loss of strength.
However, both patterns offer probabilities, not certainties, and they must be analyzed within the market context.
📘 On Day 18/90, we’ll learn how to use the Morning Star and Evening Star in real trades, including possible entries, Stop Loss, Take Profit, and practical examples.
💬 Question:
🤔 When analyzing a possible trend change, do you feel more confident with a three-candle pattern than with a single-candle one? Why?
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