- Guide To Understanding Shooting Star Candlestick Patterns
- Shooting Star
- How to Trade Using the Shooting Star Candlestick
- Primary Sidebar
- How to Trade the Shooting Star Pattern
The body of the candlestick needs to be small showing that price has collapsed back lower. The color of the candle, or if price closes higher or lower does not matter.
Guide To Understanding Shooting Star Candlestick Patterns
It is crucial you identify this pattern after a swing higher in price action and not after a swing lower. The reason this is so important is because the shooting star can sometimes be confused with the inverted hammer candlestick. By themselves these candlestick looks the same, however they form at completely different areas which is what sets them apart. Read about how to trade the hammer and inverted hammer pattern here.
The price action of the shooting star is showing us that the bulls tried to push the price higher, but by the end of the session the bears had wiped away the gains and had sent price back lower. This bearish rejection is showing us that a potential reversal back lower could soon be on the cards.
Shooting Star
This is why we need to identify this pattern up at a swing high or after price has made a move higher. We need to see higher prices getting rejected for a new move back lower. Once you know how to find the shooting star pattern, there are simple trading strategies you can start using to enter trades.
- equity bank uganda forex rates.
- Reader Interactions.
- Shooting Star Candle Strategy (Updated )!
- 2016 forex rates!
The two most common trading strategies with the shooting star are making an entry as soon as the candle has finished forming and using confirmation. A confirmation entry is when you are looking to make sure the candlestick pattern confirms itself. With the shooting star you are looking to see that price moves below the low of the candle for your entry.
You can use a sell stop entry to do this automatically. The example below shows how you could use this pattern to find and then make trades.
How to Trade Using the Shooting Star Candlestick
After price moves higher it forms a shooting star. You could either enter as soon as the candlestick finishes forming or, you could enter a short trade when price moves below the low of the shooting star.
You stop loss could go above the high of the shooting star and your target would be the recent swing low support area. This indicator comes with a number of features, such as displaying five unidirectional candles, displaying a confirmation signal and giving you optional alerts.
Primary Sidebar
This is a premium indicator, but you can try it for free with a trial. It is a bearish reversal pattern that consists of one candle.
- How to Trade the Shooting Star Candlestick Pattern on eToro?
- money management forex excel indonesia.
- average salary forex trader;
- www forex!
The Shooting Star looks exactly the same as the Inverted hammer , but instead of being found in a downtrend it is found in an uptrend and thus has different implications. Like the Inverted hammer it is made up of a candle with a small lower body, little or no lower wick, and a long upper wick that is at least two times the size of the lower body. The long upper wick of the candlestick pattern indicates that the buyers drove prices up at some point during the period in which the candle was formed but encountered selling pressure which drove prices back down for the period to close near to where they opened.
How to Trade the Shooting Star Pattern
As this occurred in an uptrend the selling pressure is seen as a potential reversal sign. After encountering this pattern traders often check for a lower open on the next period before considering the sell-signal valid.
- Shooting star pattern example?
- mahadev forex dadar.
- The Bearish Shooting Star.
- Shooting Star Candle Strategy.
As with the Inverted hammer most traders will see a longer wick as a sign of a greater potential reversal and like to see an increase in volume on the day the Shooting Star forms. From Wikipedia, the free encyclopedia. Main article: Candlestick pattern. Technical analysis.