Morning star is a three-candlestick bullish reversal pattern that signals the end of a downtrend. It consists of a large bearish candle, followed by a small-bodied indecision candle (or doji), and then a large bullish candle. Like the morning star that appears before sunrise, this pattern heralds a new bullish day.
- Three-candle bullish reversal pattern
- Sequence: Bearish → Indecision → Bullish
- Appears at bottoms after downtrends
How Morning Star Forms
The pattern shows shift from bearish to bullish:
Morning Star Formation:
Day 1 Day 2 Day 3
(Red) (Small) (Green)
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Day 1: Strong selling continues downtrend
Day 2: Small body shows indecision (sellers exhausted)
Day 3: Strong buying shows bulls taking over
Quick Reference: Morning Star Criteria
| Candle | Description | Requirement |
|---|---|---|
| First | Large bearish | Continues downtrend |
| Second | Small body/doji | Shows indecision |
| Third | Large bullish | Closes above first candle midpoint |
Example: Trading Morning Star
Morning Star at Support:
| Day | Open | Close | Pattern |
|---|---|---|---|
| 1 | ₹105 | ₹95 | Large red candle |
| 2 | ₹94 | ₹93 | Small doji at support |
| 3 | ₹95 | ₹106 | Large green, BUY |
| Stop | - | ₹91 | Below pattern low |
| Target | - | ₹115 | Previous resistance |
Morning star is a three-candle bullish reversal: large red candle, small indecision candle, then large green candle. It signals the end of a downtrend. The third candle confirms the reversal. Most reliable at support levels.
Morning Star Variations
Classic Morning Star
Middle candle is a small body. Gaps add strength.
Morning Doji Star
Middle candle is a doji. Stronger signal of indecision.
Morning Star with Gaps
Gaps between candles increase reliability.
Confirmation Requirements
Third Candle
- Should be bullish (close > open)
- Should close above first candle’s midpoint
- Larger body = stronger signal
Volume
- Volume should increase on third candle
- Shows conviction behind the reversal
Location
- At key support levels
- After extended downtrend
Trading Strategy
Entry
- Enter on close of third candle
- Or next day’s open
- Aggressive: Enter during third candle if convincing
Stop Loss
- Below the lowest point of pattern (usually middle candle low)
- Gives room for minor retest
Target
- Previous resistance levels
- Measured move (pattern height projected up)
- Use trailing stop for extended moves
Common Mistakes
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Not waiting for completion – Pattern isn’t confirmed until third candle closes.
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Ignoring location – Morning star at random location is weak.
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Third candle too small – Needs conviction. Small third candle = weak signal.
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No stop loss – Even good patterns fail.
How JournalPlus Tracks Patterns
JournalPlus lets you tag morning star patterns at entry, tracking your success rate with this classic reversal formation.
