Doji Candlestick Pattern

What the Doji pattern means

A doji means buyers and sellers fought to a draw over the period. After a strong trend, that balance can warn that momentum is fading and a reversal may be near. On its own a doji is not a signal, it is a pause that needs context and confirmation from the next candle.

How the Doji is traded

• →Treat a doji as a warning, not an entry. Wait for the next candle to confirm direction before acting.
• →A doji after an extended up or down move is more meaningful than one inside choppy, sideways price.
• →Place stops beyond the doji's high or low so a failed reversal takes you out cleanly.
• →Combine it with location, such as a key support or resistance level, rather than trading it in isolation.

Common mistakes

• ✕Trading the doji itself instead of waiting for confirmation.
• ✕Reading every doji as a reversal when most appear in noise.