The Evening Star Candle Pattern appeared in the chart for the stock $EVTL on January 20, 2022. Watch this video by Head Trader at Turbo Trading, Robert Knight, to learn more about the Evening Star Candle Pattern. $EVTL is Vertical Aerospace LTD. A transcript appears below.
This is a pattern, a reversal pattern. I want to talk about, I've done a lot of videos on this, but this is real time right now. So I thought it might be apropos. This candle is called a lot of things: Gravestone, Shooting Star, Evening Star with this next red candle. Call it whatever you want. The thing, the point is that when you have as big run-up with the stock and I've wrote this just before it went, I said, if this next two minute candle goes red, then you want to get out of the trade.
So you get this big spike up. It closes at the bottom of the range, right on the support in this case. And then the next candle goes red, you need to get out of that trade because 70, 80% of the time, at least maybe 90 % of the time it fails, it goes off. Now the thing is, you don't know how far it's going to go down.
It will occur, you know, it's going to pull back, in this case, it's pulled back a buck and a half from the top on 1070 to 940. So a dollar 30 (cents) move to the downside. If you had a, you know, put in a market order to catch this run, uh, you might've, you know, chase if you had FOMO chasing it. So. This is, we don't know how far it'll go down, but we just know that it's 90% of the time, 80% of the time it's going to correct and continue to sell off.
The problem is now that you have this, this is your candle. This is your, your volume, uh, to 3,000-265,000. And then the next candle, you know, a hundred thousand, 150,000. All of a sudden you've got a lot of overhead in the stock now. From the people that were buying this coming in, thought it was going to run.
Don't sell those that chased it. Now, you know, any kind of bounce it's going to have some trouble because you've got this big overhead for it now, but this is just a really good pattern to recognize. Soon as you see that next candle's red, you just need to get out of the trade.