1. What Is a Doji Candle?

A Doji candle is a candlestick pattern where the opening and closing prices are virtually equal — or very close to each other. This creates a candle with a very small or non-existent real body, typically appearing as a cross, a plus sign, or a horizontal line.

Fig 1: The 5 types of Doji candles — Standard, Long-Legged, Dragonfly, Gravestone, and 4-Price Doji.

How Doji Candles Are Formed

A Doji forms when the open and close are at the same price level, or very close to it. This means that whatever movement occurred during the session, it ended with no net change.

• Price opened at a certain level
• Price moved up and/or down during the session
• Price closed at or very near the opening price
• Result: A candle with a very small body and long shadows (or no shadows at all)

What Doji Candles Tell Traders

• Indecision — neither buyers nor sellers have control
• Potential reversal — especially at the top or bottom of a trend
• Potential continuation — in the middle of a trend, it may signal a pause
• Requires confirmation — a Doji alone is not a trading signal

Fig 2: The structure of a Doji candle — small body with long shadows indicating market indecision.

2. Standard Doji

The Standard Doji is the most basic and frequently occurring Doji pattern. It forms when the opening and closing prices are virtually identical, with wicks (shadows) on both sides that are relatively balanced.

Fig 3: Standard Doji — open and close are virtually equal with balanced upper and lower shadows.

Key Characteristics

• Real body: Very small or non-existent
• Upper shadow: Present, relatively balanced
• Lower shadow: Present, relatively balanced
• Signal: Market indecision

What the Standard Doji Tells You

• The market is undecided — neither buyers nor sellers dominated the session
• It often appears during consolidation or before a breakout
• The meaning depends on context — at the top of a trend, it may signal a reversal; in the middle, it may signal a continuation
• Always wait for confirmation from the next candle

3. Long-Legged Doji

The Long-Legged Doji is a variation where the upper and lower shadows (wicks) are significantly long, while the real body remains very small. This pattern indicates strong indecision and a fierce battle between buyers and sellers.

Fig 4: Long-Legged Doji — long upper and lower shadows indicate a strong battle between bulls and bears.

Key Characteristics

• Real body: Very small
• Upper shadow: Very long
• Lower shadow: Very long
• Signal: Strong indecision, potential reversal

What the Long-Legged Doji Tells You

• Fierce battle — both buyers and sellers pushed price to extremes
• Neither side could maintain control — the market is highly uncertain
• Often appears after a strong trend move
• Can signal a potential reversal or a pause
• Requires strong confirmation due to the extended range

4. Dragonfly Doji

The Dragonfly Doji is a distinctive pattern where the opening and closing prices are at the high of the session, with a long lower shadow and little to no upper shadow. It resembles a “T” shape.

Fig 5: Dragonfly Doji — a T-shaped pattern with a long lower shadow, indicating buyers rejected lower prices.

Fig 6: Dragonfly Doji at the bottom of a downtrend — a strong bullish reversal signal.

Key Characteristics

• Real body: Very small
• Upper shadow: None or very short
• Lower shadow: Long
• Signal: Bullish reversal (especially at support)

What the Dragonfly Doji Tells You

• Sellers pushed price lower during the session
• Buyers stepped in and drove price back up to the opening level
• The long lower shadow shows that bears tried to take control but failed
• Indicates buying pressure and potential upside
• Strongest signal when it appears at the bottom of a downtrend

5. Gravestone Doji

The Gravestone Doji is the opposite of the Dragonfly Doji. It forms when the opening and closing prices are at the low of the session, with a long upper shadow and little to no lower shadow. It resembles an inverted “T” shape.

Fig 7: Gravestone Doji — an inverted T-shaped pattern with a long upper shadow, indicating sellers rejected higher prices.

Fig 8: Gravestone Doji at the top of an uptrend — a strong bearish reversal signal.

Key Characteristics

• Real body: Very small
• Upper shadow: Long
• Lower shadow: None or very short
• Signal: Bearish reversal (especially at resistance)

What the Gravestone Doji Tells You

• Buyers pushed price higher during the session
• Sellers stepped in and drove price back down to the opening level
• The long upper shadow shows that bulls tried to take control but failed
• Indicates selling pressure and potential downside
• Strongest signal when it appears at the top of an uptrend

6. Four-Price Doji

The Four-Price Doji is the rarest and most extreme Doji pattern. It occurs when the open, high, low, and close are all at the same price level — appearing as a horizontal line on the chart.

Fig 9: Four-Price Doji — the rarest Doji pattern where open, high, low, and close are all at the same price.

Fig 10: Four-Price Doji on a chart — extreme indecision often followed by a significant move.

Key Characteristics

• Real body: None (open = close)
• Upper shadow: None (high = open)
• Lower shadow: None (low = open)
• Signal: Extreme indecision

What the Four-Price Doji Tells You

• Extreme indecision — the market didn’t move at all during the session
• Very rare pattern — often appears during periods of extremely low volatility
• Can signal a major breakout in either direction
• Requires special attention because of its rarity
• Often followed by a significant price move

7. How to Trade Doji Patterns

The Importance of Context

A Doji is not a trading signal by itself. Its significance depends entirely on the context in which it appears:

• At support — a Doji may signal a bullish reversal
• At resistance — a Doji may signal a bearish reversal
• In the middle of a trend — a Doji may signal a pause or continuation
• After a strong move — a Doji may signal exhaustion

Confirmation — The Key to Success

Always wait for confirmation from the next candle before entering a trade. The confirmation candle should move in the direction of the anticipated trade:

• Bullish confirmation: A green/white candle closing above the Doji’s high
• Bearish confirmation: A red/black candle closing below the Doji’s low

Stop-Loss Placement for Doji Trades

When placing a stop-loss for a Doji trade, consider the following guidelines:

• For a bullish trade: Place your stop-loss below the lower shadow of the Doji
• For a bearish trade: Place your stop-loss above the upper shadow of the Doji
• For a long-legged Doji: Consider using the 50% level of the Doji’s range as a reference for stop placement
• For a four-price Doji: Place your stop-loss just below (for longs) or just above (for shorts) the Doji level

8. Doji Candlestick Reference Table

Use this reference table to quickly compare all 5 types of Doji candles, understand their signals, and identify the best trading contexts.

10. Conclusion

The Doji candlestick is one of the most versatile and frequently occurring patterns in technical analysis. Whether it’s a Standard Doji signalling indecision, a Dragonfly Doji hinting at a bullish reversal, or a Gravestone Doji warning of a bearish turn, understanding these patterns can significantly improve your trading.

Key takeaways:

• ✅ There are 5 types of Doji candles: Standard, Long-Legged, Dragonfly, Gravestone, and 4-Price Doji
• ✅ A Doji represents market indecision — neither buyers nor sellers have control
• ✅ The context in which the Doji appears determines its significance
• ✅ Always wait for confirmation from the next candle before entering a trade
• ✅ Place your stop-loss beyond the Doji’s wick for proper risk management
• ✅ Use the reference tables above to quickly identify and trade Doji patterns

Continue your trading education — explore the guides below to deepen your understanding of technical analysis and risk management.

Updated: June 2026