Morning Star Candle, Evening Star Candlestick and Engulfing Pattern Candlestick

Morning Star Candle

Analysis of the Morning Star Candle Pattern

Morning star pattern is a three day bullish price reversal candlestick pattern.

First day is a long black candlestick.

The second day is morning star that gaps away from the long black candlestick.

Third day is a long white candlestick that fills the gap.

The filling of the gap & closing of the white candlestick above the gap is a strong bullish signal.

Open a buy trade after the market closes above the morning star gap. This confirms the buy signal from the pattern.

Evening Star Candlestick

The Evening Star Candlestick Pattern Indicates a Reversal Contrary to the Market Direction Shown by the Morning Star Candle.

Technical Analysis of Evening Star Candlestick Pattern

Evening star pattern is a three day bearish price reversal candlestick pattern.

First day is a long white candlestick.

The second day is the evening star that gaps away from the long white candlestick.

Third day is a long black candle that fills the gap.

The filling of the gap and remaining of the black candlestick underneath the space is a sturdy bearish.

Investors and Traders are advised to initiate a short position once the market price closes beneath the gap formation established by the evening star candlestick pattern. This closure serves as the confirming sell signal generated by this specific candle structure.

Engulfing Pattern

The engulfing setup is a reversal candle pattern. It can be bullish or bearish, depending on whether it shows up at the end of a downtrend or uptrend.

Technical Analysis of Bullish and Bearish Engulfing Patterns

The color of first candlestick indicates the market trend of day.

The next candle must fully cover the prior one. It needs to show the opposite color for the trend.

For a Bullish Engulfing, the candle color is blue. For Bearish Engulfing, it's red.

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Morning Star Candle, Evening Star Candlestick and Engulfing Pattern Candlestick