In the stock market, the morning star is a K-line combination form composed of three K-lines, which is a form in which the market bottoms out and turns. If this pattern appears in a downtrend, attention should be paid, because at this time the trend has issued a relatively clear reversal signal, which is a very good time to buy.
The K-line form of the morning star generally appears at the end of the downtrend, which is a strong trend reversal signal. Cautious investors can analyze the trading volume and other indicators to obtain the corresponding investment reference. In the stock market, the “morning star” on the K-line chart indicates that the downtrend will end, and the market is on the eve of rising.
The morning star is generally composed of 3 K lines for 3 trading days:
On the first day, the stock price continued to fall, and a huge negative line appeared due to panic selling, and the general trend was not good;
On the second day, the gap went down, but the decline was not large, and the real part was shorter, forming the main part of the star. The part that constitutes the star can be either a negative line or a positive line;
On the third day, a long Yang line rose from the ground, and the price recovered most of the losses of the first day, and the market sent a clear bullish signal.
This is a candlestick combination pattern that shows the market bottoming out after revelation. It consists of 3 K-lines. First, a long black candlestick appears in a downtrend, and then the price continues to fall in the subsequent trading days, but the distance between the opening price and the closing price narrows (the price range narrows) to form a star, and the candle body itself can be a white candlestick or black candlesticks. A long white candlestick appeared on the third trading day and returned to the range of the first candlestick.
The morphological characteristics of the morning star: the first day is a big Yin Xian, the second day is a small Yin Xian with a downward gap, and the third day is a Yang Xian.