The small body sits at the bottom of the candle. The long upper wick shows buyers pushed price far higher — but sellers overwhelmed them and drove it back down before the close.
What is a Shooting Star?
The Shooting Star is the bearish mirror image of the Hammer. It has a small body at the bottom of the candle and an upper wick at least twice the length of the body. There is little to no lower wick.
The name comes from the shape — it looks like a star that has been shot across the sky, leaving a long trail above it as it falls.
What Does a Shooting Star Tell You?
The story a Shooting Star tells is powerful and clear. During the period, buyers pushed price significantly higher — the long upper wick proves it. But then sellers came in hard and drove price all the way back down, closing near the lows of the range. The buyers tried to rally, and completely failed.
At the top of an uptrend, this is a serious warning. It shows that the buying pressure which drove the trend is being met with strong selling. The bulls are exhausted.
Shooting Star vs. Inverted Hammer
These two patterns look identical — small body at the bottom, long upper wick. The difference is location:
Shooting Star
Appears at the top of an uptrend. Bearish reversal — sellers are overwhelming buyers at the highs.
Inverted Hammer
Appears at the bottom of a downtrend. Potential bullish signal — buyers tried to reclaim ground, watch for confirmation.
How to Trade the Shooting Star
- ✓ Look for it at the top of a clear, extended uptrend — the stronger the prior move, the better.
- ✓ Ideally forms at a key resistance level, a previous high, or a round number.
- ✓ Wait for the next candle to close red before entering short — this confirms the reversal.
- ✓ High volume on the Shooting Star candle significantly strengthens the signal.
- ✓ A red body (close below open) is slightly stronger than a green body Shooting Star.
- ✗ Don’t short a Shooting Star mid-trend or below key resistance.
- ✗ Never skip the confirmation candle — price can recover and continue higher.
Stop loss placement: Place your stop just above the high of the Shooting Star’s upper wick. If sellers are truly in control, price should not break back above that high.