The Shooting Star Pattern
The Shooting Star, the name sounds brilliant. This is the opposite of the Hammer pattern discussed previously. This pattern points to momentary bearish sentiment in the market.
A Bearish reversal Pattern
This is seen when sellers have momentarily gained the upper hand over the buyers in the market. As you can see from the image the shooting star consists of a small body at the bottom of a long wick.
What does this tell us
The pattern shows us that from the open the buyers raised the price all the way to the high. At that moment the sellers regained control pushing the price back down passed the open. Resulting in a bearish close of the candle.
This piece of advice cannot be repeated too much – candlestick patterns or any other type of patterns are not to be traded in isolation.
[Learn more: “Limitations of candlestick charts”