Forex Questions and Answers - FXAnswer

A bullish morning doji star candlestick is a candlestick patter with a long black day followed by a Doji that gaps in the direction of the trend. The third day is a white day which closes in the top half of the black day.

In a downtrend or during a pullback within an uptrend, the market gaps down but does not continue its downward movement. Instead enough bulls step up to bring supply and demand back into equilibrium and the stock churns in place. This is the bullish Doji Star formation. A subsequent follow through gap up that closes above the midpoint of the black day completes the Morning Doji Star and confirms the reversal.

The bullish Morning Doji Star is similar to the bullish Abandoned Baby and bullish Morning Star.

Source(s):

http://www.leavittbrothers.com/education/ candlestick_patterns/bull/ morning_doji_star_bullish.cfm

In FX this formation practically identical to the bullish Abandoned baby. In non-FX markets candlestick analysts traditionally look for gaps to signal the strength of the Morning Doji Star pattern. Gaps between the close price and open price are very common outside efficient FX markets, since exchanges are traditionally limited to very short trading periods. Because Foreign Exchange trades 24 hours, gaps are very uncommon and need to be ignored in identifying Morning Star patterns.

The bullish morning doji star (ake no myojyo doji bike) candlestick pattern (view full size chart) is one of the triple candlestick patterns (i.e. it consists of three individual candlesticks), and it is a bullish pattern.

The bullish morning doji star candlestick consists of a downward candlestick (e.g. a red candlestick), followed by a smaller doji candlestick (e.g. a candlestick that opens and closes at the same price) that opens (and obviously closes) below the low of the previous candlestick (i.e. a gap down), followed by an upward candlestick (e.g. a green candlestick) that opens above the high of the previous candlestick (i.e. a gap up), and closes above the close, and below the open, of the first candlestick (i.e. in the middle of the first candlestick).

Use In Trading

The bullish morning doji star pattern can occur in a number of different contexts (e.g. at the beginning of a trend, during a trend, at the end of a trend, etc.), but it is most relevant when it occurs during a significant downward trend. The bullish morning doji star pattern is a bullish pattern, and can be used as an indication of the end of a downward trend. The bullish morning doji star pattern is somewhat similar to some of the other three candlestick patterns, but once the differentiating aspects are understood, the pattern is relatively easy to identify on a price chart.

Source(s):

daytrading.about.com

Bullish Morning Doji Star is a candlestick pattern that offers one of the strongest bullish reversal signals. It occurs after a significant downtrend. Price opens and close at or near the same point. This indicates indecision which usually serves as an indicator that the market has reached its limit, the bears have lost strength and simply cannot move the market further downward.

Confirmation of the bullish doji star would consist of an upward movement which creates the next bullish candle, the stronger the move up, the stronger the reversal signal.