Bearish Doji Star
The Bearish Doji Star pattern is a three bar formation that develops after an up leg.
The first bar has a long white body while the next bar then opens even higher and closes as a Doji with a small trading range.
The final bar then closes below the midpoint of the first day.
How to identify
- 1st day is a long white day.
- 2nd day is a doji day that gaps above the 1st day.
- The doji shadows shouldn’t be excessively long.
The uptrend is in full force with a strong 1st day. All confidence built up by the bulls from the 1st day is destroyed when the 2nd day’s gap up closes near its open. Profit takers will quickly appear if the next day opens lower.