I noticed that many beginners in technical analysis overlook a very useful pattern that helps catch reversals in upward trends. It's about the Shooting Star — that very falling star that often predicts a change in the price direction.

Here's why this pattern works. When the price is rising and suddenly a candle forms with a small body at the bottom and a huge upper shadow — this is a clear signal of a struggle between bulls and bears. First, buyers push the price up, but then sellers break them down and close the candle almost at the open. This is the shooting star pattern in action.

The characteristics I look for:

The candle body is small, at the bottom — indicating that bulls have lost control. The upper shadow takes up more than 2/3 of the entire candle length — this is the main sign. The lower shadow is almost absent or very minimal. This combination indicates that the initiative has shifted to the sellers.

When I see a shooting star at a resistance level or after a prolonged rise, I immediately understand — the probability of a reversal upward sharply decreases. Especially if trading volumes are high at the same time. This confirms that sellers are serious and ready to push the price down.

In trading, I use this scheme. First, I wait for confirmation — the next candle must close below the previous one. Only then do I open a short position. I place the stop-loss above the pattern's high to avoid an unexpected hit. I set the take-profit at the nearest support.

What else helps? I combine the shooting star with RSI or MACD. If the indicators also show oversold conditions or divergence, then the signal becomes much more reliable. That's when I feel more confident about my entry.

A practical example: the asset has been rising for a long time, reaches an old maximum, and there a candle forms with the characteristic signs of our pattern. The next candle opens lower and closes even lower. This is the moment when I open a position and expect a decline to the next support level. It usually works well if the trend was really long and the pattern formed in a key zone.