Video summary

Most Powerful Candlestick Strategy | Morning Start Candlestick Pattern ?

Main summary

Key takeaways

Finance

Finance-focused summary: “Morning Star” triple candlestick strategy (bullish)

Presenter / source: Wiz Trader (YouTube channel). Uses a three-candle bullish pattern called Morning Star and explains when to trade it, how to confirm entry, and how to set stops/targets.

What to look for (Morning Star structure)

A bullish Morning Star is a 3-candle pattern:

  1. Candle 1: Big red bearish candle
  2. Candle 2: Small candle — color doesn’t matter (green or red)
  3. Candle 3: Bullish green candle (reversal upward)

Additional quality notes

  • The pattern is considered stronger if Candle 3 closes meaningfully higher versus Candle 1. The speaker references examples like:
    • Candle 3 close being around 50% above Candle 1’s body, or
    • 60–70% above (as described),
    • or Candle 3 closing above the opening of the red Candle 1 (described as “very good”).
  • Entry trigger: wait until the high of the red candle (or whichever candle creates the highest high) is broken.

When to trade vs. ignore

  • Trade only when the stock is in a downtrend / correction phase.
  • If the broader trend is already uptrend, the speaker frames the setup differently: bullish candlestick hunting is less appropriate if the market is already trending up—the Morning Star should ideally appear after a correction/down leg.

Required “downfall” / prior weakness (key timing rules)

Daily timeframe

  • Need 6–7 days of meaningful decline before the Morning Star forms.
  • Percent correction guidance includes:
    • around 10–20% correction (daily timeframe),
    • and mentions 15–30% where the pattern may appear.

Monthly timeframe (fallback rule)

  • If the strict 6–7 candles requirement isn’t met, a fallback is described:
    • after a good correction over ~4 months, if Morning Star forms after ~4 candles, it can still be traded.

Intraday example (5-minute timeframe)

  • Requires a downfall of ~7–8 candles, plus additional intraday magnitude:
    • mentions ~1.5% to 2% decline as a necessary condition,
    • and cautions against trading minor drops like ~1%.

Confirmation / entry methodology (step-by-step)

  1. Confirm the Morning Star forms after the required downtrend/downfall (per timeframe rules).
  2. Do not enter immediately when the pattern completes.
  3. Enter only after a breakout of the high:
    • specifically: “until the high of the red candle is broken”
    • generalized: enter when the high of whichever candle is the highest is taken out.
  4. Ensure the move meets the qualitative threshold (strength of Candle 3 close vs. Candle 1).

Stop-loss rules (explicit)

  • Stop-loss placement: place SL below the lowest low among the three candles.
  • The speaker emphasizes SL should remain below the relevant candle low.

Example levels mentioned

  • Entry ~ ₹175
  • Stop loss ~ ₹135
  • Implies stop distance of roughly ~20–22% (speaker mentions ~22/23% and “20 to 22%” range).

Targeting / risk-reward guidance

  • If stop-loss distance is around 20–25%, target at least 1:2 (risk:reward).
  • First target: “catch the first target” consistent with ~1:2.
  • Second target / profit management:
    • If momentum breaks around the second target, book ~80% of the quantity.
    • Keep the remaining position with a trailing stop:
      • “a little below the lower swing low”
      • and manage remaining size using about ~20% quantity.

Performance / outcomes described (examples)

Example: “rocket move” after entry (long upside momentum)

  • Mentions a stock running with no red candles for ~1–7 months (exact count is somewhat unclear).
  • Mentions resistance/levels:
    • Resistance around 350
    • A phrase like “stop loss created at 252%” (appears mistyped/unclear)
    • “Stocks one way momentum is 370%” → described as a tremendous / extraordinary move
  • Key takeaway: this level of momentum isn’t always seen, but it can happen.

Example: Zomato (intraday setup referenced)

  • Mentions Zomato on a 5-minute timeframe.
  • Notes a hammer pattern before/within the broader reversal context.
  • Pattern behavior described:
    • after Morning Star, consolidation, then retest, followed by tremendous one-way momentum.

Instruments / tickers explicitly mentioned

  • BSE (Bombay Stock Exchange) – exchange referenced for charts
  • Zomato – explicitly mentioned

Price levels mentioned (contextual)

  • Entry around ₹175
  • Stop loss around ₹135
  • Resistance around 350

Disclosures / disclaimers

  • No explicit “not financial advice” disclaimer appears in the provided subtitles.

Presenters / sources

  • Wiz Trader (YouTube channel / speaker)

Original video