Evening Star Definition and Use – Candlestick Pattern

What is Evening Star candlestick pattern
What is Evening Star candlestick pattern

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The Evening Star candlestick pattern is a chart pattern that shows when the trend turns down. Traders look at it as a bearish candlestick pattern including a tall bullish candle, a small candle/Doji candle, and a tall bearish candle.

Contrary to the Morning Star pattern, the Evening Star candlestick pattern is part of a group of models that predict the time of a reversal. Most Traders still regularly hit this pattern every time it comes because the accuracy is high. Evening Star candlestick is dedicated to trading down/sell, catching the time when the trend reverses from bullish to bearish.

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Evening Star candle characteristics

As its name implies, the Evening Star talks about the time when Venus shines brightly in the afternoon. The sky changes from day to night with a small but brilliant star. The Evening Star candlestick pattern is a combination of three candles:

  • Candle 1: A long bullish candlestick.
  • Candle 2: Is a Doji candlestick, with opening and closing at the same price, forming a cross or a plus sign.
  • Candle 3: A long bearish candlestick, the closing price is inside the body of Candle 1.

Evening Star candlestick usually appears at the end of an uptrend that can be as strong or mild as possible. But when a Doji appears, followed by a long bearish candlestick with a characteristic like Candle 3, it is a sign of a reversal.

Evening Star candlestick pattern definition and uses
Evening Star candlestick pattern definition and uses (source: Olymp Trade)

Make a trade upon seeing Evening Star pattern

This pattern only applies to signal the start of a downtrend. Most Traders, who meet the Evening Star, enter a sell/decrease trade and get the profit immediately.

Your signal is the market is steadily growing, then a Doji candle followed by a bearish candle appears. Once see it, make a sell/down right at the end of candle 3, the sooner the better it is. The body of the 3rd candle should be as close to the bottom of candle 1 as possible.

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If you are in FTT, you use 1-minute candles, place orders for 5 minutes, if you use 5-minute candles, place orders for 30 minutes and 60 minutes.

Note

This pattern is easy to confuse if you do not catch the following:

  • The Evening Star pattern occurs at the end of an uptrend.
  • Candle 1 should be a long body candle.
  • Candle 2 is a Doji or a very small candle.
  • Candle 3 should be a Bear candle with a long body, but the closing price remains inside candle 1.
  • If the candle 3 longer than usual, you need to consider using other indicators, patterns, and tactics to see if there is a big move imminent.

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Evening Star Definition and Use – Candlestick Pattern
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