Shooting Star

Formation
This formation consists of two candles.

First day is white candle.

Second day is black or white candle with a small real body, which gaps above the real body of the first day. There is a long upper shadow and no or a very small lower shadow.

Importance
This pattern indicates that the market opened near its low, then strongly rallied and finally pulled back to close near the opening. The up trend could not be sustained.

This is a minor reversal pattern. Next day's price movement confirms whether the trend is reversed or continuing. The confirmation may be in the form of a long black candle with a gap down real body.

Sometime the gaps may not be obvious.

Study the chart given below.