Doji Candlestick Pattern Explained: A Complete Guide

A doji forms when a period's opening and closing prices are at or very close to the same level, resulting in a very small or virtually nonexistent body. The Japanese term is generally translated as reflecting the idea that open and close are "the same thing." Depending on wick length, a doji can resemble a cross, an inverted cross, or a plus sign.

A doji is generally discussed as reflecting indecision or a balance between buyers and sellers during that period — neither side gained decisive control, since the period closed roughly where it opened, regardless of any intra-period movement shown by the wicks.

Several named variations exist based on where the small body sits relative to the wicks: a dragonfly doji has open/close near the high with a long lower wick, sometimes discussed in the context of potential bullish reversals at the bottom of a downtrend. A gravestone doji has open/close near the low with a long upper wick, sometimes discussed in the context of potential bearish reversals at the top of an uptrend. A long-legged doji has long wicks on both sides, reflecting significant intra-period movement in both directions before closing near the open.