Star

DEFINITION of 'Star'

1. A type of candlestick formation that is identified when a small bodied-candle is positioned above the price range of the previous candle as a result of a gap in the underlying assets price.

Star



2. One of the four categories (quadrants) of the BCG growth-share matrix that represents the division within a company that has a large market share in a rapidly expanding industry.

BREAKING DOWN 'Star'

1. Small bodied candles in the star position often suggest that market participants are becoming indecisive and that the strength of the current trend could be reversing. For a valid star pattern, most traders will watch for small bodied candles to follow a large bodied candle because this setup generally leads to a higher probability of a true trend reversal than when the body of the first candle is small.

2. A star requires investment capital to expand continually within a fast growing industry, thus maintaining its advantage. Should the industry mature with the star positioned as a leader, the star will transform into a cash cow.

RELATED TERMS
  1. Cash Cow

    1. One of the four categories (quadrants) in the BCG growth-share ...
  2. Dog

    One of the four categories or quadrants of the BCG Growth-Share ...
  3. BCG Growth Share Matrix

    A planning tool that uses graphical representations of a company’s ...
  4. White Candlestick

    A point on a candle stick chart representing a day in which the ...
  5. Hook Reversal

    A short-term candlestick pattern, occurring in either an uptrend ...
  6. Spinning Top

    A type of candlestick formation where the real body is small ...
Related Articles
  1. Technical Indicators

    Using Bullish Candlestick Patterns To Buy Stocks

    These five popular candlestick chart patterns signal a bullish reversal in downtrend.
  2. Chart Advisor

    Lighting The Way With Candlesticks

    Learn how candlesticks let you quickly spot the continuation or reversal of a near term trend.
  3. Stock Analysis

    Candlestick Charts: Quickly Spot Patterns With This Popular Charting Style

    Candlestick charts were first used by rice traders in Japanese futures markets in the 1700s. They were introduced to traders outside of Japan in 1991, when "Japanese Candlestick Charting Techniques" ...
  4. Active Trading

    Tales From The Trenches: Location Is Everything

    When a candle pattern re-occurs near a moving average, it may indicate future support or resistance.
  5. Active Trading

    Candlesticks And Oscillators For Successful Swing Trades

    Take advantage of short-term price moves by pinpointing reversals.
  6. Chart Advisor

    Two Candlestick Patterns Predicting A Bottom

    This article tries to find some bottoms in four stocks using two different candlestick patterns.
  7. Charts & Patterns

    Advanced Candlestick Patterns

    Go beyond the basics! Learn to identify and trade island reversals, kicker patterns and more.
  8. Charts & Patterns

    The Basic Language Of Candlestick Charting

    If you want to use candlestick charting to get a sense of where a stock is headed, you need to learn how to read this unique charting language.
  9. Charts & Patterns

    Candlestick Charting: What Is It?

    Discover the components and basic patterns of this ancient technical analysis technique.
  10. Chart Advisor

    Are Alcoa And Conoco Set For A Turnaround?

    Bullish candlestick formations will cause traders to add these three stocks to their watch lists.
RELATED FAQS
  1. How is an Evening Star pattern interpreted by analysts and traders?

    Identify the evening star candlestick pattern, and learn why it is interpreted by market analysts and traders as a bearish ... Read Answer >>
  2. How effective is creating trade entries after spotting a Star pattern?

    Understand the basics of the morning and evening star patterns and how traders and analysts use this pattern to establish ... Read Answer >>
  3. How are Star patterns interpret by analysts and traders?

    Understand the basics of the morning and evening star patterns and how they are interpreted by traders and analysts when ... Read Answer >>
  4. How do I build a profitable strategy when spotting a Morning Star pattern?

    Create a profitable trading strategy to use when spotting a morning star candlestick pattern that indicates a bullish market ... Read Answer >>
  5. How do I Implement a forex strategy when spotting a Morning Star pattern?

    Learn how to design a forex trading strategy to use for trading the morning star candlestick pattern, an indicator of a bullish ... Read Answer >>
  6. How effective is creating trade entries after spotting a Evening Star pattern?

    Explore the elements of the evening star candlestick pattern, and learn what factors influence the effectiveness of trade ... Read Answer >>
Hot Definitions
  1. MACD Technical Indicator

    Moving Average Convergence Divergence (or MACD) is a trend-following momentum indicator that shows the relationship between ...
  2. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  3. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  4. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  5. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  6. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
Trading Center