Morning Star - Candle stick pattern.

Morning star is a candle stick chart pattern. Morning star pattern is used by technical analyst of stock market to find reversal of trend in stock market. Technical analyst use morning star patterns to predict future prices of stocks. Morning star pattern occur at the end of downtrend and indicates the change of trend from bear to bull trend.

Morning star pattern is made up of three candles. First one is large bearish candle, second or middle candle may be bullish or bearish or neutral. Second candle may be small in size. Third candle large bullish candle. 

On the first day of morning star pattern supply dominate the demand and creates large bearish candle. On second day candle opens with gap down. Bearish or bullish gap down will decrease the price of scrip. The candle stick on day two is small and can be bullish, bearish or neutral.  On the third day of morning star large bullish candle indicates increase of demand. Third day candle pull the price upward and eliminate the loss on first day candle.

Morning star consists of three candle sticks. Trader will use higher volume to confirm morning star pattern on third day. Trader or market analysts usually see length of candles to figure out strength of pattern.

 In order to have valid morning star most traders will look at the top of the third candle to be at least half way up the body of first candle.  If first and third day candles are larger and if the third day candle moves higher in relation with first day candle then it is strong sign of reversal in trend.