These are among the most reliable reversal patterns in candlestick analysis. They consist of 3 candles and signal a potential trend direction shift.
What Stars Are
Morning Star and Evening Star are classic three-candle reversal formations. They show how the dominant side loses control and the market prepares to reverse.
Morning Star
🌅 Morning Star — bullish reversal signal
Appears after a downtrend. Structure:
- Large red candle (sellers dominate)
- Small candle of any color — small body, balanced wicks, with its wick above the first candle wick
- Large green candle — the stronger it is versus candle 1, the more reliable the setup
Trading parameters:
- Entry: after candle 3 closes
- Aggressive stop: below candle 2 low
- Conservative stop: below candle 1 low
- Take profit: RR 1:2 or nearest resistance
Evening Star
🌇 Evening Star — bearish reversal signal
Appears after an uptrend. Structure:
- Large green candle (buyers dominate)
- Small candle of any color — small body, wick above candle 1 body, not an inside bar
- Large red candle — the stronger the better; must close below wick low of candle 2
Trading parameters:
- Entry: after candle 3 closes
- Stop: above candle 2 or candle 3 high
- Take profit: RR 1:2 or nearest support
Important Nuances
⚠️ In crypto, these patterns appear less often than in forex — because market is 24/7 and true gaps are rare. But when they appear on 1D or 4H, they often work very well.
This pattern is always counter-trend versus the current move. So confirmation is required: close of candle 3 plus, ideally, a nearby key level.
Pattern without a level is weak. Pattern at a key level is serious.
Summary
- Morning Star = bullish reversal after a decline
- Evening Star = bearish reversal after growth
- Trade only after candle 3 closes with a clear stop
- Works best on 4H and 1D near levels