Doji Candlestick Pattern 

What Is a Doji Candle Pattern and What Does It Mean? 

A doji is a candlestick pattern that shows when an asset’s opening and closing prices are almost the same. On a chart, it usually looks like a small cross, plus sign, or inverted cross. 

This pattern shows indecision in the market,buyers and sellers push prices up and down, but by the end of the session, the price returns to where it started. When several doji candles appear together, it may suggest a possible trend reversal or a pause before the next big move. 

The word doji comes from Japanese and means the same thing. 

Key Points 

A doji appears when the open and close prices are nearly identical. 

It signals market hesitation,neither buyers nor sellers are in control. 

Doji candles are rare and shouldn’t be used alone to predict reversals. 

There are three main types of doji: 

Gravestone Doji, looks bearish and appears at market tops. 

Dragonfly Doji, looks bullish and appears at market bottoms. 

Long-Legged Doji, shows strong indecision with long upper and lower wicks. 

Understanding a Doji 

Candlestick charts show four main data points: open, high, low, and close. 
If the open and close are nearly the same, the candle’s body is tiny, forming a doji. 

When this happens, it means buyers and sellers are balanced, and the market has no clear direction. Traders often see this as a sign that a trend might soon change but it can also mean the market is just taking a breather before continuing in the same direction. 

Using a Doji in Trading 

A doji found after a strong uptrend can suggest a potential bearish reversal, while one after a downtrend might signal a bullish reversal. 
Traders usually confirm these signals with other indicators such as RSI, MACD, or moving averages before making a trade. 

Doji vs. Spinning Top 

Both doji and spinning top candles show indecision: 

A doji has a very small or no body (open ≈ close). 

A spinning top has a slightly larger body, showing mild indecision rather than complete balance. 

Both patterns are neutral on their own, so traders combine them with other tools to understand whether a reversal or continuation is more likely. 

Limitations 

A doji by itself doesn’t predict much. 

It’s not common, so traders shouldn’t rely on it alone. 

Entry and stop-loss points may be tricky since doji candles don’t show clear price targets. 

Summary 

A doji forms when prices open and close at nearly the same level, showing market indecision. 
Depending on its shape and position: 

Near the high → Dragonfly Doji (bullish) 

Near the low → Gravestone Doji (bearish) 

In the middle → Long-Legged Doji (neutral) 

In short, a doji means the market is uncertain. It’s most useful when combined with other indicators to confirm potential trend reversals or breakouts.