#adp02The Evening Star Candlestick Screen is the 6th in the series: Japanese Candlestick Trading: Stock Screens for 15 Candlestick Patterns

Evening Star & Evening Doji Star

Signal Type: Reversal
Bias: Bearish
Inbound Trend: Bullish
Reliability: 9 of 10
Candlesticks in Pattern: 3

Pattern Definition
The Evening Star candlestick pattern is a significant top reversal pattern consisting of three candlesticks. They appear at the end of a substantial uptrend, and are most reliable when price reaches a critical overhead area of resistance, such as a trend line, or fibonacci retracement level. This pattern is significant enough to be traded as the only trading signal, or in conjunction with a momentum and volatility indicator.

Formation
The evening star pattern is a three day pattern characterized by the following

• The inbound trend must be bullish
• The first candlestick must be white, with a longer than average real body
• The second candlestick can be white or black. It must gap above the first candlestick, and have a small real body
• If the second candlestick is a doji, this pattern is called an Evening Doji Star, and is a very significant pattern
• The third candlestick must be black, with a long real body, and most close with the first days white candlestick.
• The third candlestick typically gaps below the second candlestick
• The third candlestick should close below the middle of the first candlestick’s real body

Criteria That Supports

• Second candle is doji
• MACD Divergence
• Divergence in 3 / 10 oscillator

Evening Star Candlestick Pattern Stock Screen

The following screen utilizes Stock Fetcher 2.0

set{body_bottom,min(open,close)}
set{body_top,max(open,close)}
set{body_size, abs(body_top minus body_bottom)}
set{large_body, 1.5 * body_size}
set{small_body, .75 * body_size}
set{a, close minus open}
set{b, a / 2}
set{middle, open plus b}

show stocks where body_size 2 days ago is greater than CMA(large_body,30)
and open 2 days ago is below close 2 days ago
and open 1 day ago is above close 2 days ago
and close 1 day ago is above close 2 days ago
and body_size 1 day ago is less than CMA(small_body,30)
and close is below open
and close is below close 2 days ago
and close is above 5
add column middle

Options for Adjusting the Screen
1. change the line “and close is below close 2 days ago” to “and close is below middle 2 days ago” (don’t use the ” marks)
2. adjust the size of large and small bodies
3. add minimum trading volume.

Popularity: 9% [?]