Evening Star
A three-candle formation of a large rising candle, a small-bodied candle, then a large falling candle closing well into the first body.
How it is identified
Test: candle 1 rises strongly; candle 2 has a small body above it; candle 3 falls and closes below the midpoint of candle 1's body
Unit
qualitative
In depth
The evening star mirrors the morning star, encoding a strong advance, a pause, and then a decisive reversal of much of the advance. Its three-candle structure means it takes three periods to identify, so by the time the formation is complete a substantial move has already occurred — which is true of every multi-candle pattern and is the practical cost of the additional conditions. The midpoint requirement is the discriminating condition and should not be relaxed if the term is to mean anything. No directional claim is made here.
Worked example
Candle 1 rises from ₹494 to ₹528, midpoint ₹511. Candle 2 has a ₹4 body around ₹532. Candle 3 falls to close at ₹506, below the midpoint. By completion, price is already ₹22 off the high.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Evening Star” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.