Morning Star + Evening Star Candlestick Patterns Explained -- with David Moadel
hello friends and welcome to looking at the markets with David Modell
Morningstar and evening star it's not as complicated as you might think it is a
three candlestick pattern and so it's pretty specific and you're not gonna see
it super often probably but it's good to know it's good to be aware of it because
it can be a powerful reversal pattern but please be aware that it does not
work a hundred percent of the time in fact I don't know an indicator that does
work a hundred percent of the time so make sure that you're confirming
whatever you're doing with other indicators and use your common sense and
judgment and by the way before I get started if you want some coaching for
your trading or investing I do offer the coaching you can email me for that at
David Modell at gmail.com alright so let's get into it
again it's not as complicated as you might think it is a three candle pattern
okay three candlesticks and so if you don't see all three of these then it's
not a morning star or an evening star now here's the morning star pattern it
is bullish it's a bullish reversal pattern here's the evening star it is a
bearish reversal pattern okay so let's look at the morning star first so it's a
bullish reversal pattern meaning before you had bearish price action going down
down down okay but then something happened to reverse it to make it bounce
in the other direction going upwards now and so these are the three candles and
so the pattern for both of these morning star and evening star is big small big
okay just remember big small big big candle small candle big candle alright
so what does that mean well for the Morningstar you got a you know a bunch
of red candles so okay it's going down down down and so
you got to remember big small big so you got a big red candle okay and then a
small candle here probably going to be green it can be red but probably green
okay because it's going to reverse now it's gonna start going up and so you got
a usually green but a small candle here now this could be a doji or a spinning
top and these two examples it's a spinning top meaning that it has a small
body and an upper and lower wick okay a doji would be like no body just a flat
okay flat body and also an upper and lower wick but in this case it's more of
a spinning top than a doji it has a small body and but also an upper and
lower wick okay and that signals indecision and possible reversal in this
case definitely reversal otherwise it would not be a Morningstar because so
after the small candle then you have another big once remember big small big
okay here's the big one and it's gonna be green all right and so this
definitely was a reversal candle because the next one was a big green candle all
right and that makes it a Morningstar and then not always but technicians
would think that there's a strong possibility that the next candle is
going to be green and then green and green okay it's going to generally trend
upwards after this pattern possibly no guarantees but this is you know pretty
powerful according to market technicians all right
so big small big all right big red candle and then small indecision candle
either probably green if it's going to be a Morningstar either doji or in this
case a spinning top here and then a large green candle and that's the
Morningstar and it's considered bullish all right so then you have the opposite
of that you have the evening star it's still big candle small candle big candle
big small big right but now you have a trend upwards bunch of
a bunch of green candles okay then a big green candle which is still bullish but
then you have the indecision candle and in the evening stars case it's probably
a red one all right and it's going to be either a doji with a flat body and two
wicks upper and lower wick but in in this case it's a spinning top which is a
small body and an upper and lower wick and then it's red probably for an
evening star and then the next candle if it's a big red one then then you got
your evening star okay big green indecision candle big red and that's the
evening star and then market technicians would think there's a strong possibility
that the next one's going to be red because it's a reversal pattern so then
they're gonna expect downward price action after that all right no
guarantees of course does not work 100% of the time that's the evening star
which is bearish okay so a Morningstar Bear evening star
Morningstar bullish evening star bearish okay big small big big small big there
you go and you also maybe want to study doji
candles and spinning tops I have videos on those in my technical indicators
playlist so you can click on that at the end of this video if you want to over a
hundred videos in my technical indicators playlist right now so lots to
learn and if you want more help though okay
because videos are probably good not going to be enough for you by themselves
okay you might want some coaching some mentoring I offer that you can email me
at David Modell at gmail.com for that and if you like this video if it's
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again soon