Shooting Star Candlestick on a Live Gold Chart

What it shows

Each shooting star gets a red label marked SS over the candle’s high.

How Pravex works it out

For the shooting star, a body is the distance between open and close, and long or small is judged against a 14-candle exponential average of those bodies: above it is long, below it is small. The first 13 candles have no average yet, so no shooting star is found there.
The shape is one candle with a small body (below the average) that is not a doji. Doji, for the shooting star, means a body of 5% of the range or less, high minus low, with a range above zero.
The upper shadow must be at least 2 times the body, and the lower shadow no more than 10% of the candle’s range. Either body colour counts.
Before the shooting star counts, the shooting star candle itself has to show an uptrend, which by default means a close above the 50-candle simple moving average.
The shape test is shared with the inverted hammer; only the trend before it differs.

Settings

Setting	Default	What changing it does
Trend check	SMA50	How the uptrend before the shooting star is measured on the shooting star candle: SMA50 compares its close with the 50-candle simple average. The choice that adds SMA200 also needs the 50-candle average above the 200-candle one, so fewer shooting star labels appear, and the last choice turns the check off.
Label colour	Red (#F23645)	The fill of the SS label over the high of each candle where the shooting star pattern is complete; its white text needs a colour it reads well on.

How traders read it

The story is a failed push. Price went well above the previous candles and could not stay there, so the high of the shooting star marks a level where sellers were waiting. That makes the high the obvious line in the sand: a close above it says the sellers have been absorbed.

The common confirmation is the next candle closing lower, ideally under the shooting star’s body. Traders who short it usually put the stop just above the high of the shadow. Because the shadow is long, that stop can be wide, so the size of the candle is worth checking against your risk before anything else.

On gold, a shooting star right after a spike on data releases says more about that release than about the trend. One that forms at a level price has failed at before is the stronger case.

When it misleads

Strong rallies print long upper shadows and keep climbing, so a lone shooting star in a steep trend often fails. Our trend test only asks for a close above the 50-candle average, which a bounce inside a fall can also meet. Small-range candles in quiet hours meet the proportions easily and carry little weight. The candle still forming is checked again on every update, so a shooting star label can show up on it and vanish before the close; only a shooting star label on a closed candle stays.

Questions and answers

Is a shooting star bearish?

Yes. It shows a rally rejected within one candle after a rise. It is a warning that still needs the next candle to close lower.

What is the difference between a shooting star and an inverted hammer?

The shape is identical. Pravex calls it a shooting star after a rise and an inverted hammer after a fall.

Is a shooting star the same as a gravestone doji?

They are close. A shooting star has a small real body; when the body is 5% of the range or less and there is almost no lower shadow, Pravex marks a gravestone doji instead.

Where do traders put a stop on a shooting star?

Just above its high, since a close above that level means the sellers who rejected the rally have lost.