When is a shooting star formation valid?

To be properly interpreted, a shooting star formation is only considered valid when it occurs following a recognizable uptrend of some duration and when it occurs at or near the highest price in recent market action. The shooting star pattern is just one of many signals of potential market reversals recognized in candlestick charting.

How are Shooting Stars formed?

When this happens, the friction that this space object has with the atmosphere causes it to reach very high temperatures and, consequently, it becomes incandescent and glow. In this way, it is how shooting stars are formed , and how their brightness and the trail they leave behind are produced.

When does a shooting star appear?

It appears after an uptrend. Said differently, a shooting star is a type of candlestick that forms when a security opens, advances significantly, but then closes the day near the open again. For a candlestick to be considered a shooting star, the formation must appear during a price advance.

What does the'shooting star pattern' mean?

It indicates that although the price traded significantly higher during the time frame the candlestick reflects, higher prices were strongly rejected as sellers entered the market and buyers exited, eventually driving price sharply lower to end the time period and form the shooting star pattern.