What is the upper-wick-to-body ratio?
Reveal the worked answer
Six: (103−100)/|99.50−100|.
Calculate from the supplied OHLC, then distinguish geometry from the uncertain future.
Technical Analysis · TA-02j · Core
Shooting star
How do you recognize shooting star without treating it as an automatic entry?
What you will learn and prerequisites
- Read the exact candle geometry.
- Identify prior context.
- State a confirming and an invalidating branch.
Read first: Market structure comes first, Candlestick anatomy and the ten-pattern path
A shooting star has a small real body near the bottom of the range and a long upper shadow. It records an upper-price excursion that did not persist through the close. After a rise, it can support an upper-rejection hypothesis.
Put location before the name
The fictional setup occurs after an upswing into a premarked upper-price area. That reference must be known before identifying the signal; otherwise a trader can invent convenient support or resistance afterward. Match the pattern's timeframe with the context timeframe and state when the bars finish.
The illustration is an original teaching sequence, not an alert, backtest or historical probability. The user's candle panel supplies the syllabus, not a specification for automated trading thresholds.
Read the geometry
Body is 0.50, upper wick is 3.00 and lower wick is 0.20. Upper-wick/body equals six. OHLC alone does not reveal whether the high came before the low, the size traded at the extreme or tomorrow's direction.
Walk both next-bar branches
A confirming branch for this particular process is a later close below 99.30 with an unsuccessful recovery. An invalidating branch is sustained trade above the candle's 103 high. Write both before watching the next interval. Confirmation is additional evidence, not certainty; failure means the original premise needs reassessment.
Even a visually confirmed pattern can offer poor execution economics. Check the next obstacle, spread, available liquidity and consequence of a failed entry. A bullish candle does not automatically justify buying an expensive call, and a bearish one does not justify uncovered short calls.
Read the completed bars
Use these exact data: bar 1: open 100.00, high 103.00, low 99.30, close 99.50. Begin with open and close, then inspect the shadows. Compare completed intervals; do not assume a particular high–low order within one interval.
Body is 0.50, upper wick is 3.00 and lower wick is 0.20. Upper-wick/body equals six. OHLC alone does not reveal whether the high came before the low, the size traded at the extreme or tomorrow's direction.
Now rehearse the favorable and adverse branches above. Explain what would change your confidence without changing the already-completed candle. The chart and popup use this same OHLC sequence, so the lesson can be reproduced numerically rather than memorized from a decorative drawing.
Open the calculation without leaving this lesson
Shooting star—fictional completed intervals
Vertical: USD per share
Horizontal: Completed interval
Hollow body: close at or above open. Filled body: close below open. Neither color is a trade instruction.
Read the graph as a data table
| Interval | Open | High | Low | Close |
|---|---|---|---|---|
| 1 | 100 | 103 | 99.3 | 99.5 |
The named shape is not a guarantee
The adverse branch is sustained trade above the candle's 103 high. Maintaining the original label does not restore the premise. A similar-looking candle in the middle of overlapping range trade may have much less useful context.
Another failure is hindsight selection: locating only successful examples after seeing their outcomes. A usable process needs stated definitions, transaction costs and out-of-sample evaluation before any claimed edge.
Check your understanding
Try the question before revealing its answer. These are reading checks, not trading certification or a site completion record.
Does this pattern establish a profitable options entry?
Reveal the worked answer
No.
Instrument price, time, liquidity and the loss scenario must also be evaluated.
Recognize the shooting star, locate it, and explain both confirmation and failure before discussing a trade.
Sources, assumptions and downloadable script
External references support definitions and conventions. Worked scenarios and prose are original. No current quotes or dealer inventory are claimed.
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