Evening Star
A three-candle reversal pattern that forms after a rise. A large green candle is followed by a small-bodied candle, and then by a red candle that closes below the middle of the first candle's body. It can signal that buying pressure has stalled and sellers are starting to step back in.
How it forms
- It follows a clear rise. Since it is a reversal signal, there needs to be a move to reverse.
- Candle 1 is a long green candle: its body is at least half of its range and clearly larger than the bodies of the previous candles.
- Candle 2 has a small body: at most one-third of candle 1's body. Its colour does not matter. The bottom of its body does not fall below the upper quarter of candle 1's body, and its high is the highest point of the three candles.
- Candle 3 is red and closes below the midpoint of candle 1's body.
In the textbook definition, candle 2 opens with a gap above candle 1's close. Crypto trades 24/7, so such gaps are rare. Instead of a gap, candle 2 is identified by its small body sitting at or above candle 1's close. When candle 2 is a doji, the pattern is also called an evening doji star.
What it suggests
Candle 1 shows buyers in control. In candle 2, the rise tries to continue but the body stays small: neither side takes over. Candle 3 then gives back more than half of the ground candle 1 gained. This sequence can suggest that the balance is starting to shift from buyers to sellers.
The pattern completes with candle 3's close. Before that, there is only a pause. Even when complete, it does not prove that the direction has changed on its own, and should be weighed together with other evidence.
When it strengthens, when it weakens
Strengthens
- Candle 2 forming at a resistance zone
- A clear rise before the pattern
- Candle 2 being a doji or having a very small body
- Candle 3 closing near or below candle 1's open
- Rising volume on candle 3
- Forming on a higher timeframe (4H, 1D)
Weakens
- Forming in a flat, directionless market
- Candle 3 only just closing below the middle of candle 1's body
- Low volume on candle 3
- A strong support zone just below
- Forming on very low timeframes (1m, 5m)
The MarketLevelMap view
How it relates to zones
In an evening star, each of the three candles tells you something different when read with zones:
- If candle 2 forms at a resistance zone, the rise can be said to have paused exactly where price reacted before. The star's high often sits inside the zone or just above it.
- If candle 3 closes below the zone's lower edge, the zone pushing price back is easier to read. If the close stays inside the zone, the picture is less clear.
- If a support zone sits near candle 1's open, there is a level below the ground candle 3 gave back where buyers are waiting. Above that level, the pattern is considered weaker.
An evening star that forms away from any zone may just be an ordinary pullback within the rise. The zone gives a reason why the rise might have stopped there.
When it completes
Candle 3 closing below the midpoint of candle 1's body.
When it is invalidated
Before completion: If candle 3 does not close below the midpoint of candle 1's body, the pattern is not complete. If price closes above candle 2's high, the setup breaks down entirely.
After completion: Once complete, if price closes above the pattern's highest point (usually candle 2's wick), the bearish scenario is considered invalid. If the pattern formed at a resistance zone, a close above the zone means the same.
Often confused with
- Morning StarThe opposite: after a decline, a small-bodied middle candle and a bullish reversal.
- Dark Cloud CoverNo middle candle: the red candle closes below the middle of the green body straight away.
- Bearish EngulfingTwo candles: the red body fully covers the green body.
For general information only. Not investment advice.Last updated: