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Tri-Star Doji pattern for profitable trading: A real Trade

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Tri-Star Doji:

This Doji pattern is formed with 3 consecutive dojis in 3 trading days. Because this pattern formed with 3 dojis and each doji looks like a star without body , this pattern is called Tristar Doji. This pattern is called walking doji because of its formation.

This doji formation is very rare in chart pattern. However, result of this pattern is highly significant. That means trading success from this pattern is very high.

Tristar Doji
Tristar Doji

From chart, we see how this chart pattern formed.

Day 1: this is the first day of the formation of this pattern. Normally we see after this doji, trend is still intact.

Day 2:

Day 2 also  follow through day 1. However, because of second doji formation trader already know trend is very week and trend reversal is highly likely.

If we see this doji in uptrend, it signals uptrend is very almost end and bull is week. Trader looks for trend reversal.

Day 3:

Day 3 is trend reversal day. We see normally 3rd doji gap up or gap down against the prevailing trend and finish the day as doji or indecisive.

 

Tri-Star Doji Trade Setup
Tri-Star Doji Trade Setup

Trade Entry:

Bullish Tri-Star doji pattern:

Trader entered the trade after 3rd Doji formation. Ideal is entry is above the highest point of the 3rd day doji candle for bullish formation.

Bearish Tri-star Doji pattern:

For bearish formation, enter the trade to the low of the third doji candle.

Trade Exit:

Bullish Tri-Star doji pattern

Trader exit the trade below the low of the third candle for bullish pattern.

Bearish Tri-star Doji pattern:

For bearish pattern, trader leaves the trade after price breaks the highest point of day 1 candle.

Real trade:

This is real world Tri-Star doji trading pattern. This is not idle one. However, because of its position and support line this was a good trade for me.

I bought call option at October 13, 2017 @ 940 for  $1200. I sold the call $3600 @ $972.5 at September 29.

This chart pattern is not perfect tri star pattern. Still I consider it like tri star because how the stock is behaving at the price.  I also noticed that  stock is already in the strong support line. So down side risk is low.

Bottom line: Doji candlestick is very powerful for candlestick trader. However, Tristar doji is one of the powerful and favorite doji candlestick pattern used by trader. However, other suitable conditions are also very important to this pattern more potent.