Morning Star and Evening Star Candlestick Patterns Explained

The morning star and evening star are three-candle reversal patterns. They're named for the planets that appear around dawn and dusk: the morning star precedes the rising sun (a bullish reading), and the evening star precedes the night (a bearish reading).

Morning Star (Bullish)

A morning star appears after a decline and has three parts:

1. Candle 1: a long red (down) candle, continuing the downtrend.
2. Candle 2 (the "star"): a small-bodied candle, red or green, that gaps down from the first candle's body. It shows indecision.
3. Candle 3: a long green (up) candle that closes well into the body of the first candle, commonly above its midpoint.

The traditional reading: selling intensified in the first candle, stalled in the second, and was overpowered by buying in the third, suggesting momentum may have turned.

Evening Star (Bearish)

An evening star appears after an advance and is the mirror image:

1. Candle 1: a long green candle, continuing the uptrend.
2. Candle 2 (the star): a small-bodied candle that gaps up from the first.
3. Candle 3: a long red candle that closes well into the body of the first candle, commonly below its midpoint.

The traditional reading: buying intensified, stalled, and was overpowered by selling, suggesting momentum may have turned down.

The Role of the Star

The middle candle is the key. Its small body means that neither buyers nor sellers made progress: a pause in the prevailing move. A doji as the middle candle gives the variants called the morning doji star and evening doji star, which are often described as stronger signals because a doji represents even more indecision.

A close relative is the abandoned baby, in which the star gaps fully away from both neighbors, including the wicks. It's rare.

What Makes It More Meaningful (Traditionally)

• A clear prior trend. A morning star after an extended decline, not a sideways stretch.
• Candle 3 closing deep into candle 1. The farther it penetrates, the more decisive the reversal is considered.
• Elevated volume on the third candle.
• A nearby support or resistance level.
• Follow-through on the next candle.

A Worked Example (Morning Star)

A stock has fallen for weeks.

• Day 1: opens at $30.00, closes at $28.00 (long red candle, body $2.00).
• Day 2: opens at $27.60, closes at $27.80 (small body of $0.20, below day 1's close).
• Day 3: opens at $28.10, closes at $29.40.

The midpoint of day 1's body is $29.00. Day 3 closed at $29.40, above that midpoint. That fits the morning star definition. A trader following the standard approach would still look for confirmation on day 4.

Gaps Are the Weak Spot

The pattern's definition requires gaps, which are uncommon in markets that trade almost continuously and uncommon for many stocks on shorter timeframes. Many analysts relax the gap requirement, which makes the pattern more frequent and less distinctive. Whether a pattern "counts" can therefore depend on a platform's settings.

What the Evidence Says

Research on candlestick patterns has produced weak and mixed results. A 2006 study by Marshall, Young, and Rose found little evidence that candlestick strategies produced reliable profits on Dow Jones stocks. Three-candle patterns are rarer than single-candle ones, so there's less data. See do chart patterns actually work.

Limits

• They're rare in strict form, and common in loose form.
• Subjective judgment on "long," "small," and "well into."
• They can fail. A morning star can be followed by a lower low.
• Timeframe dependence. See timeframes.

For related patterns, see engulfing patterns, the hammer, and the candlestick glossary.

This article is for educational purposes only and is not investment advice.