Let's understand one of the most reliable reversal signals on the chart, which many traders underestimate. It's about a pattern called Shooting Star, or in our context, simply a falling star on the candle.

I’ve noticed that when the price has been rising for a long time and suddenly forms such a configuration, it often signals a trend reversal. The essence is simple: buyers push the price up, but sellers pull it back down. On the candle, this looks like a small body at the bottom and a long upper shadow that takes up more than two-thirds of the candle's length. The lower shadow is either absent or very minimal.

What is really happening here? Market participants initially buy, the price goes up, but then sellers take control and bring it back down. The close occurs near the open, indicating weak demand. This falling star candle shows the moment when the balance of power begins to shift in favor of the bears.

But it’s important not to give in to the temptation to enter immediately. I always wait for confirmation — I want the next candle to close lower, preferably with good volume. This reassures that a reversal is truly starting. The falling star is especially effective when it forms at a resistance level or at previous highs.

When entering a short position, I place the stop-loss above the pattern's high to minimize losses if I’m wrong. I look at nearby support levels for take-profit targets. By the way, combining this signal with RSI or MACD significantly increases accuracy. When indicators confirm that momentum is weakening, you can be more confident in the signal.

Let me give a specific example. Suppose Bitcoin is in an uptrend, reaches a resistance level, and a falling star forms there. The chart shows something like 68,621 with a minus. The next candle closes lower — this is the moment to enter a short. Stop above the candle's high, and head down toward the support level.

The main thing — don’t rush. The falling star is a signal, but not a verdict. Confirmation, volume, context of levels — all of this together provides confidence. Try applying this in practice, and you’ll understand why this pattern is so valued among traders.