The Dragonfly Doji is a single day pattern. It has a ‘T’ shape. This occurs when the open and close are the same and there is a long lower shadow and no upper shadow. Having a very small upper shadow is OK.
Dragonfly Doji indicates indecision in the market and is considered as a possible trend reversal pattern. This is bullish candlestick
Psychology of Dragonfly Doji pattern is that market is on a downtrend and on the day when Dragonfly Doji appears bears are able to push prices downwards and then bulls manage to push prices back up. When prices are returned to the day open level the dragonfly doji is complete. It is very common for the lower shadow of the Dragonfly Doji to act as an area of support for future prices.
Gravestone Doji is the opposite of Dragonfly Doji.
If dragonfly doji appears after a price rise then it can indicate potential price fall of an asset. Look at the next day’s candlestick for confirmation.
Practice Dragonfly Doji – Beginner
Practice Dragonfly Doji – Intermediate