The DOJI Candle

Doji Candle indicates indecision. When the stocks are Oversold or Overbought this candle gives a significant indication. Basically when market goes up it signals the trader for lock the profit and when market goes down it also signals the trader.

Criteria for the Valid Doji signal :

* The price level of the Open and the close of the stock must be almost the same.

*An upper shadow or a lower shadow or both can be there.

Types of Doji Candle:

1. Gravestone Doji signal.

2. Dragonfly Doji signal.

3. Spinning Top

1. Gravestone Doji signal:
When the particular stock open at a price and move up during the time frame but closes right where its started. That kind of a candle formation called Gravestone Doji. Here how its look like..

2. Dragonfly Doji signal :
When the particular stock open at a price and move down during the time frame but closes right where its started. That kind of a candle formation called Dragonfly Doji. Here how its look like..

3. Spinning Top :
A Small body Candle which usually comes after big candle . And its indicate that trend (whichever it may be a Buy/Sell trend) is losing its strength. It does not necessarily mean that trend is going to reverse. It only indicate the weakness of the trend. Here how its look like..

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Candle Pattern

Bullish Engulfing :

Bullish Engulfing Consists of a small Red body that is contained within the followed large Green candlestick. When it appears at bottom it is interpreted as a major reversal signal.

Bearish Engulfing :

Bearish Engulfing Line Consists of a small Green body that is contained within the followed large Red candlestick. When it appears at top it is considered as a major reversal signal.

Bullish Harami :

Bullish Harami Consists of an unusually large Red body followed by a small Green body (contained within Red black body). It is considered as a bullish pattern when preceded by a downtrend.

Bearish Harami :

Bearish Harami Consists of an unusually large Green body followed by a small Red body (contained within large Green body). It is considered as a bearish pattern when preceded by an uptrend.

Morning Star :

Morning Star Consists of a large Red body candlestick followed by a small body (Red or Green) that occurred below the large Red body candlestick. On the following day, a third Green body candlestick is formed that closed well into the Red body candlestick. It is considered as a major reversal signal when it appears at bottom.

Evening Star :

Evening Star Consists of a large Green body candlestick followed by a small body candlestick (Red or Green) that gaps above the previous. The third is a Red body candlestick that closes well within the large Green body. It is considered as a reversal signal when it appears at top level.