Triple candlestick patterns: morning and evening star

Before reading this lesson, you should have previously read through:

In the following lesson you will learn how to interpret more complex candlestick patterns using three candles to determine price reversals.

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The morning star candlestick formation

The morning star is a reversal pattern to the upside that can be found at the end of a downtrend. The following chart shows an example of a morning star pattern:

Morning star chart pattern

number_1 The first candlestick is bearish.

number_2 The second candlestick has a small body. It does not matter if the second body is bullish or bearish (although a bullish body with a small or no upper wick indicates more bullish power). The small body serves as an indicator that the bears are losing their capacity to drive the market lower. It is also possible for the second candlestick to have no body (a doji).

number_3 The third body is bullish that closes within the first candlestick, preferably beyond the halfway point of the first candlestick. This shows that the bulls are gaining control.

Below, you can now test your knowledge about morning star patterns with an exercise we prepared for you.

Exercise: Find the morning star candlestick pattern Show exercise

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The evening star candlestick formation

The evening star is the bearish counterpart of the morning star pattern. The evening star is a reversal pattern and appears after an uptrend. The following chart shows an example of an evening star pattern:

Evening star chart pattern

number_1 The first candlestick has a strong bullish body.

number_2 The second candlestick has a small body. It can be bullish or bearish. It is also possible for the second candlestick to have no body (a doji).

number_3 The third candlestick has a strong bearish body and closes within the body of the first candlestick, preferably beyond the halfway point of the first candlestick in the pattern.

Below, you can now test your knowledge about evening star patterns with an exercise we prepared for you.

Exercise: Find the evening star candlestick pattern Show exercise

Summary

So far, you have learned that ...

  • ... the morning star and evening star are reversal patterns.
  • ... the first candlestick is in the direction of the trend.
  • ... the second candlestick can be bullish or bearish and has a small body, denoting indecision in the market.
  • ... the third candlestick is a candlestick in the direction of the reversal, closing preferably beyond the half way mark of the first candlestick.

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  • For the 2nd exercise on the evening star pattern, I don't understand why the solution is 2. The 3rd bearish candle didn't close beyond the midpoint of the 1st candle...
  • Hmm, thanks for the question, I escalated it to our coaches smile
  • Hey yongchunpower,

    The third candlestick does not have to close beyond the halfway point - it is preferable that it does, but not a necessity to make the candlestick pattern complete. The solution was designed deliberately to show this.
  • Ok if that's the case can i interpret 1 as an evening star too? Also, am I right to say that 1 shows a stronger sign of reversal than 2?
  • I would not say so. It is a bit different from the example posted in the picture above. Candles in example 1 form something like double top, and the first candle reaches higher than the second. In examples you can see, that second candle is always the one which reaches above/below others. Also the third candle does not close within the body of the first one.
  • yongchunpower:
    Ok if that's the case can i interpret 1 as an evening star too? Also, am I right to say that 1 shows a stronger sign of reversal than 2?

    I'm Afraid Matej is correct. Essentially, in the first solution, the third candles stick does not close within the "body" of the first candlestick - it closes within the wicks and so it is not the same thing. This means that it is not a evening star pattern.

    The solution is about the evening star pattern only - not comparing different patterns against each other. However, due to the fact that the first solution, the third candlestick closes very low in comparison to the the previous two candles, i would also say that this is a stronger sell signal two. The momentum clearly reversing to the downside in solution 1.
  • Oh ya now that you mentioned it, the example 1 looks more like tweezers instead! Thanks for the clarification.
  • What do you mean by "The third body is bullish that closes within the first candlestick, or preferably beyond the halfway point of the first candlestick." In the first figure the third candlestick closes outside the first candlestick. Is that an example of a non-preferable formation that is still a star formation?
    And are there also non-preferable formations that not reach the halfway point of the first candlestick that are still starformations?
  • With candlestick analysis there should always be a level of discretion. Finding the perfect setup does not happen often and it is the ability to read and give some leeway that can help some use candlestick formations effectively in my opinion at least!

    The bigger the bullish move after the star formation forms on two candles is a strong indication of a reversal. The candlestick can close in the body of the first bearish candle (If you are looking for a reversal of a downtrend) but you want really it to break up through the 50% mark of the candle of the first day. The system i use encompases it having to break the prior high and close, close to or above the high of the first candle to indicate a break out. However, that is just how i use the system.

    The morning/evening star pattern is just a permuation of the single Doji star candlestick pattern. The strongest signal on this single candlestick pattern is usually accepted as having the 'star' form and the next day having a candlestick that closes above the high of the prior days candle ie the high of the 'star candle'.
  • I still dont see why the solution is 2. In the strategy it says that the 2nd candle need to have very small or no body.
    For me it is 3, but if not, then why?
  • at 3 the first two candles are different , one is bullish and one is bearish , the first 2 candles need to be the same type (if the small body candle would have been blue it would have been the right answer).
    Number 2 could be a right answer ... are the wicks of the small candle relevant? do they need to be up for evening and down for morning?
    Because I think that is mostly why no. 2 is considered evening star.
    Maybe some1 who uses them can confirm and infirm something else biggrin.

    Thank you !
  • There seems to be no question for question 1
  • Also I am quite sure that the answer that gets a point in question 6 is not the correct one.
  • Hi WeepingAngel, yes there was some coding error there - should now be fixed
  • Thanks Dean. With the huge volume of content that is being put on the site it is understandable to have an occasional error. Thanks for the great lessons
  • mihai209:
    at 3 the first two candles are different , one is bullish and one is bearish , the first 2 candles need to be the same type (if the small body candle would have been blue it would have been the right answer).
    Number 2 could be a right answer ... are the wicks of the small candle relevant? do they need to be up for evening and down for morning?
    Because I think that is mostly why no. 2 is considered evening star.
    Maybe some1 who uses them can confirm and infirm something else biggrin.

    Thank you !

    wtf!!! this is a bit confused... someone explain this correctaly please

    the 2º paragraph of both explanations say the following

    "The second candlestick has a small body. It does not matter if the second body is bullish or bearish (although a bullish body with a small or no upper wick indicates more bullish power). The small body serves as an indicator that the bears are losing their capacity to drive the market lower. It is also possible for the second candlestick to have no body (a doji)."

    "The second candlestick has a small body. It can be bullish or bearish. It is also possible for the second candlestick to have no body (a doji)."

    something is wrong with this lessons. it seems answers 2 and 3 of both exercises are correct unless it is realy as you said "the first 2 candles need to be the same type"
  • nice! I think this pattern may occur in different timeframe. Can we call the pattern as pin bar?
  • Hi Hannnan,
    In the examples above there are actually pin bars displayed but any candlestick with very small or no body could be acceptable for the second candle. Regards.
    Peter
  • hindsighthero:
    Hi Hannnan,
    In the examples above there are actually pin bars displayed but any candlestick with very small or no body could be acceptable for the second candle. Regards.
    Peter
    Thank you sir, for replaying me.

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