Doji

Appearance: This is a single candle in which open and close prices are the same or almost the same value. There are various types of Doji:

• The simple doji where the shadow is small.
• The long-legged doji where the shadow is long.
• The gravestone doji where the open and close are at the bottom of the shadow.
• The dragon fly doji where the open and close are at the top of the shadow, and the
• Four price or perfect doji where there is no shadow.

Criteria: If there is a body it should be less than 10% of the shadow in length.

Effect: The Doji represents a period of indecision in the market and can presage a change of direction, but is best confirmed by the following candle.

Note: In candlestick descriptions, "white (green)" refers to an up-bar, and "black (red)" refers to a down-bar. Individual traders prefer different bar colors. For example, we personally trade with candles set to green for up and red for down. (TradeStation defaults their Candlesticks to this color convention.) Most related textbooks use white (or green, if color is used) for up and black (or red) for down.