Morning Star:

The Bullish Morning Star is a three-day pattern. The first day is a long, Black Candle. The second day is a short candle that can be either White or Black (Often called a Star). The Candle on the second day must gap down from the day one Black Candle. The third day is a White Candle that closes high up on the body of the original Black Candle. A gap up on day three would be preferred.

After the first Black Candle we have a short candle with a small trading range. This may be signaling that the downtrend is running out of steam. The White Candle on day three should strongly indicate that the buyers have taken over.

A Bullish Morning Star Pattern is a strong sign of a trend reversal when the day three, White Candle that closes above the second day pattern.

Remember that the Bullish Morning Star pattern is known as a reversal pattern. In other words, it is more significant when it appears after a downtrend.

Candlestick charting is just another of many technical indicators of stock market action and reaction. It should be used in conjunction with other technical indicators that are available on the Internet such as Volume, Moving Averages, Momentum, MACD, and Accumulation Distributions plots.

Many day traders and swing traders use Japanese Candlesticks as quick and easily read indicators of the current Bull and Bear status of a particular stock. There are many sites on the Internet that will give you candlestick charts of any stock code you enter. You can review them and seek out any of the hundreds of popular patterns but if you subscribe to the information offered on this site:

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