The Evening Star Candlestick pattern is a bearish reversal pattern that typically occurs at the end of an uptrend.
What does the Evening star candle pattern look like?
This pattern consists of three candlesticks:
- The first candlestick is a large bullish (green or white) candle, indicating strong buying pressure.
- The second candlestick is a small-bodied candle, known as a “star”, which can be either bullish (green) or bearish (red). This candle opens with a gap above the close of the previous candle, suggesting that the uptrend may be slowing.
- The third candlestick is a large bearish (red or black) one, opening below the close of the star and closing at least halfway into the first candle’s body. This shows a shift in sentiment and strong selling pressure.
What does this chart pattern suggest?
The Evening Star pattern is significant as it indicates that the bulls are losing control and bears are ready to take over. However, like all patterns, it should not be used in isolation. Traders should consider other technical analysis such as market structure before making trading decisions based on this technical charting pattern.
