The Morning Star is a three-candle bullish reversal at the bottom of a downtrend. Candle 1 is a large bearish candle. Candle 2 is a small-bodied candle (or doji) that gaps down — signaling indecision. Candle 3 is a large bullish candle that closes at least halfway into Candle 1's body.
Three-act reversal story: defeat (Candle 1 — strong selling), doubt (Candle 2 — indecision at the lows), then reversal (Candle 3 — bulls decisively take control). Each act plays out over consecutive sessions, making this one of the most structurally clear reversal patterns.
One of the highest-reliability reversal signals in technical analysis. Expect +5–12% over 7–14 trading days. Ideal entry point for buying calls or closing short positions. The third candle IS the confirmation.
Example Chart
Bear → doji (indecision) → bull recovery above midpoint