CDL_CDL_SHOOTINGSTAR (Shooting Star)¶

Overview¶

The Shooting Star is a single-candle bearish reversal pattern that bearish reversal pattern with long upper shadow. This pattern is used to identify potential trend changes and provides traders with entry signals when combined with proper confirmation.

Parameters¶

Parameter	Type	Default	Description
`open`	Array	Required	Array of opening prices
`high`	Array	Required	Array of high prices
`low`	Array	Required	Array of low prices
`close`	Array	Required	Array of closing prices

Parameter Details¶

Note: Array elements should be ordered from oldest to newest (chronological order)

OHLC Arrays - All four price arrays must have the same length - Minimum 1 candle required for pattern detection - More historical data provides better context for trend analysis

Usage¶

Basic Usage¶

require 'sqa/tai'

open =  [50.0, 49.5, 48.0, 47.5, 48.5]
high =  [50.5, 50.0, 48.5, 48.0, 49.5]
low =   [49.5, 48.5, 47.5, 47.0, 48.0]
close = [49.5, 48.5, 48.0, 47.5, 49.0]

pattern = SQA::TAI.cdl_shootingstar(open, high, low, close)

puts "Shooting Star signal: #{pattern.last}"
# Output: -100 (pattern detected) or 0 (no pattern)

Understanding the Pattern¶

What It Measures¶

The Shooting Star pattern measures: - Reversal Potential: Shift in market sentiment and momentum - Market Psychology: Bulls pushed prices higher but lost control, bears regained momentum - Trend Exhaustion: Signs that current trend is losing strength

Pattern Characteristics¶

Type: Single-candle bearish reversal
Trend Context: Must appear in uptrend
Signal: -100
Reliability: Moderate to High (with confirmation)
Best Timeframes: Daily, 4-hour charts

Trading Signals¶

Entry Signals¶

Primary Entry: Short when next candle closes below shooting star body

Risk Management: - Stop Loss: Above the high of the shooting star - Target: Recent support level - Risk/Reward: Aim for minimum 1:2 ratio

Confirmation Requirements¶

Strengthen the signal with: 1. Volume Confirmation: Increased volume on signal candle 2. Trend Confirmation: Clear uptrend established 3. Support/Resistance: Pattern at key price level 4. Next Candle: Following candle confirms direction

Best Practices¶

Optimal Use Cases¶

Market Conditions: After established trend with clear momentum
Timeframes: Most reliable on daily charts
Asset Classes: Stocks, forex, commodities
Volatility: Normal volatility environments

Combining with Other Indicators¶

RSI: Confirm overbought/oversold conditions
MACD: Verify momentum shift
Volume: Validate buying/selling pressure
Moving Averages: Confirm trend context

RSI - Momentum confirmation
MACD - Trend and momentum
Volume OBV - Volume confirmation