Technical Glossary / Candlestick Patterns
Morning Star
A three-candle bullish reversal: a long down candle, a small-bodied pause, then a strong up candle.
Teaching sketch. It shows the shape, not a live quote and not a trade signal.
Definition
The morning star comes after a decline. The first candle is a long bearish body. The second is a small body, a spinning top or doji, that can gap down. The third is a bullish candle closing well into the first candle's body, classically past its midpoint.
How to identify it
Three bars, in order: large down, small, large up. The middle bar is the "star." Its small range is the stall. The third close should repair a meaningful part of the first body.
Bullish reading
The sequence says the decline paused and was then bought. Traders use the low of the star as the invalidation and want the third candle to close strong, not as a wick.
Bearish reading
If price breaks the star's low, the pause resolved downward and the pattern failed.
Common mistakes
Skipping the middle bar and calling any down-then-up pair a morning star. The stall is required. Also accepting a third candle that barely closes up.
Limitations
Three candles is still a small sample. The level under the star matters more than the nickname.
This note explains the term. A sketch shows the shape of the idea. Neither is a recommendation, a signal, or a comment on any security. Indicator settings and exchange conventions differ. Check the live chart and the contract specification before you use a number.