Shooting Star

The Psychology
In an uptrend or within a bounce of a downtrend, the stock gaps up. A valid attempt is made to rally the stock, but the strength subsides and the stock falls to close near the day's low and near its opening price. Failure to follow through with strength suggests the bulls may be losing strength. Although this is not necessarily extremely bearish, it is less bullish, so stops should be moved up or profits taken on longs. For a reversal to occur a weak day is needed to confirm the pattern.

A small body forms at the lower end of the trading range. The upper shadow is usually long while the lower shadow is small or almost nonexistent.

Pattern: reversal
Reliability: low/moderate