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Glossary · Candlestick patterns

Shooting star

A bearish reversal candle after a rise: a small body near the low and a long upper wick showing a rally that was rejected.

By Sky Trade editorial teamUpdated

A shooting star forms after an advance. Price rallies during the period, sellers push it back down, and the candle closes near its low. The result is a small body at the bottom and a long upper wick — typically at least twice the body — with little or no lower wick.

It is the mirror image of the hammer, and its look-alike in a downtrend is the inverted hammer. Same shape, different location, different reading.

What strengthens a shooting star:

  • a clear prior rise and a location at resistance;
  • an upper wick that pierces a level while the close falls back below it;
  • confirmation by the next candle closing lower.

What weakens it: appearing inside a range, in a thin market where one stray quote prints the wick, or just before news.

The common error is treating the shape as the whole signal. Many long upper wicks are followed by new highs, especially in strong trends. On short expiries the pattern's influence, if it has any, is limited to the next few candles. See shooting star and inverted hammer.

Example

EUR/USD rallies into 1.0950. An M5 candle opens at 1.0948, reaches 1.0962 and closes at 1.0946: a 2-pip body and a 14-pip upper wick poking above the level. A cautious trader waits for the next candle to close below 1.0945.

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