A Doji candle can be an important signal in candlestick analysis. Where the OPEN price is equal to the CLOSE price, a doji candlestick has formed.
Classically, a doji candle denotes uncertainty in the prevailing trend and is arguably a neutral signal.
However, it would be wise not to dismiss them as trading signals. They denote the equal matching of the buyers and sellers.
If the prevailing trend is strong, the appearance of a doji can therefore be the early sign of trend change. Whereas, a small doji candle as part of a consolidation range is considered to be a very weak trading signal.
Although the standard form of a doji pattern is a plus sign, it can also take other forms. The level of the OPEN and CLOSE prices of the doji candlestick, relative to the HIGH and LOW prices can also be important.
Doji can be single-period signals but can also feature as part of several other multi-period candlestick set-ups (such as the Morning Doji Star and the Evening Doji Star).
Using Doji signals
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