Doji candlestick
neutral · candle pattern
A doji is a single-candle pattern where open and close are at (or very near) the same level, producing a thin horizontal body with shadows. Doji signal indecision — equilibrium between buyers and sellers — and gain meaning only in the context of the surrounding trend and volume.
Formation rules
- Open ≈ close (within 5% of total range)
- Upper and lower shadows visible
- Pattern matters most after extended trends
How to trade it
Use doji as an alert, not a signal. After an extended uptrend, a doji combined with declining volume suggests possible reversal and warrants tightening stops or hedging. Standalone doji in choppy ranges have no edge.
Common pitfalls
- Doji are extremely common — most carry no signal
- Always require trend context
Statistical context
Doji are part of every candlestick textbook from Nison onward. Standalone they have no documented edge; combined with prior trend extension and volume divergence they meaningfully shift base rates.
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