15.

Bullish Tri Star

Definition

Bullish Tri Star formation forecasts an upcoming ascending trend, signalling a trend
reversal. It consists of three Dojis. The middle Doji is a Doji Star.

Trend: Reversal
Expected trend: Bullish
Previous trend: Bearish
Reliability: Moderate
Type: Bullish
Number: 3

Construction:

First candle
 a doji candle in a downtrend
Second candle
 a doji candle
 a body below the prior body
Third candle
 a doji candle
 a body above the prior body
Recognition:
 The market is in a downward trend.
 All three days are Dojis.
 The first and third Doji is a gap higher than the second Doji.

Interpretation:
The appearance of a Doji in a long, inclining trend makes investors unsure. The
second Doji is a gap below the first one. At this point the prices changes should be
monitored closely. Narrow trading ranges indicate the weakening of the current trend
and may forecast a possible trend reversal. The third day is also a Doji, but the trading
range is higher than on the previous day. There is a high chance for reversal, but a
confirmation is still needed.

Important factors:
To make sure the trend is reversed, a confirmation on the fourth day is needed. The
confirmation could come from a white candle with an upward gap or a higher closing
price.

What Is The Psychology Behind The Bullish Tri-Star Pattern?

A. The Bullish Tri-Star pattern reflects a shift in market sentiment from bearish to
bullish.

B. The appearance of the first Doji after a downtrend signifies indecision and a
potential weakening of the bearish momentum.

C. The second Doji, which gaps lower, suggests that sellers are still trying to push
the price down, but the market remains indecisive.

D. The third Doji, which gaps higher, indicates that buyers are starting to regain
control, and a trend reversal may be imminent.

How To Trade The Bullish Tri-Star Reversal Pattern?

E. To trade the Bullish Tri-Star pattern, wait for confirmation by a subsequent
bullish candle.

F. The buy trigger occurs when a bullish candle closes above the high of the third
Doji, confirming the trend reversal.

G. Place a stop loss order below the low of the third Doji to protect against potential
false breakouts or a sudden reversal.

H. As the price moves in your favor, consider using trailing stops or other risk
management techniques to lock in profits and minimize potential losses.

Additional Tips
I. While the Bullish Tri-Star pattern can be a powerful reversal signal, it is
important to use it in conjunction with other technical indicators and chart
patterns to confirm the trend change.

J. Additionally, be aware of the overall market context and consider factors such as
support and resistance levels, as well as the strength of the prevailing trend.

K. Keep in mind that the occurrence of this pattern is relatively rare, and proper risk
management is always necessary.
L. Continue to learn about Japanese candlesticks through books, such as Steve
Nison’s “Japanese Candlestick Charting Techniques” and “Beyond
Candlesticks.”