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DOJI is called as morning and evening star in technical anaysis
Morning star- Doji found after a gradual fall of price- buy because there is a chance to increase in price
Evening star- Doji found after gradual raise of price- sell because there is a chance to decrease in price
Morning Star: After a price declining trend if Doji appears with good volume it is termed as Morning Star. Because an upward price movement is gonna to take place so after a dark night a morning star is in the sky showing a bright day is awaiting to pass on so it is named as Morning Star.
Evening Star: <span style=”line-height: 1.5;”>After a price increasing trend if Doji appears with good volume it is termed as Evening Star. Because a downward price movement is gonna to take place so after a bright day an evening star is in the sky showing a dark night is awaiting to pass on so it is named as Evening Star.</span>
Use of Morning Star: go for long position. Buy at Doji day highest price in the next day. Stop loss at Doji day lowest price. Expected Profit at least 1.5 times taken risk.
Use of Evening Star: go for short position.
If the previous day bearish candle followed by Doji which appears below the bottom of the previous day candle then this is called a morning star, then we can expect a Bullish day. So it’s time to buy.
If the previous day bullish candle followed by Doji on top then this is called a evening star, then we can expect a Bearish day. So it’s ideal to create a short position.
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