Gravestone Doji

What is the Gravestone Doji?

The Gravestone Doji has open and close essentially equal AND at the low of the candle's range. The upper wick is long; there is no lower wick.

The pattern signals that during the session, buyers pushed price aggressively higher — and were completely rejected. Sellers stepped in at the highs and drove price all the way back down to the open. The close at the session low is the strongest possible intra-session bearish signal short of a full bearish marubozu.

How to identify a Gravestone Doji

Requirements:

1. Body is a Doji (open and close essentially equal). 2. Body is at the very bottom of the candle's range. 3. Upper wick at least 2x the (tiny) body length. 4. Lower wick non-existent or less than 5% of the upper wick.

Position at an uptrend top with horizontal resistance is what activates the bearish signal. In mid-trend or in ranges, the Gravestone is much weaker.

How to trade the Gravestone Doji

Standard rules.

Confirmation entry: Enter short on a close below the Gravestone Doji's low. Stop loss above the Gravestone's high. Target at previous swing low or 1.5-2x stop distance.

Aggressive entry: Enter short on a 50% retracement of the upper wick during the next candle. Tighter stop just above the high.

Gravestone Dojis at major horizontal resistance or at the 200 EMA on a Daily chart produce some of the highest-conviction bearish reversal setups in price action.

More patterns and definitions in the forex glossary, or see them stacked on real charts in the trading blog.

Gravestone Doji FAQ