Business, Legal & Accounting Glossary
The Gravestone Doji candlestick indicates indecision and in a rising market signals the possibility of a bearish trend reversal. The Gravestone Doji rarely occurs during a downtrend.
A gravestone doji is a variation on the doji candlestick with a long upper shadow and no lower shadow, such that it resembles an inverted “T.” The trading pattern that creates a gravestone doji proceeds with the price of a security opening at the low of the day, rising to a high, and then selling off back to the low. Depending on the trend that precedes it, a gravestone doji may signal a bullish reversal or a bearish reversal. Traders consider both the bullish and bearish gravestone doji a moderately reliable signal. A gravestone doji that occurs during an uptrend is bearish; the price advance to a daily high and sell-off back to the open suggests buying interest isn’t strong enough to sustain upward momentum. A gravestone doji that occurs during a downtrend is bullish; the price advance and sell-off back to the open suggests selling pressure was strong enough to prevent the advance but not enough to continue the trend. Trading on subsequent days confirms the reversal signalled given by the gravestone doji.
The Gravestone Doji is one candlestick and looks like an upside-down “T”; the opposite of the Dragonfly Doji. The Gravestone Doji has a long upper shadow and no lower shadow, and it forms when the open, low and close are equal. The high is what creates the long up er shadow.
The Gravestone Doji candlestick indicates that prices were driven higher during the session, and by the end of the session, the prices came back down to the opening level and the session low as a result of the sellers. As with other Doji’s, this candlestick signals a potential change in direction.
To help you cite our definitions in your bibliography, here is the proper citation layout for the three major formatting styles, with all of the relevant information filled in.
Definitions for Gravestone Doji are sourced/syndicated and enhanced from:
This glossary post was last updated: 22nd March, 2020 | 3 Views.