Doji
Open and close are very close. Signals indecision. The “signal” is usually the breakout/confirmation after the doji.
NeutralIndecisionMedium reliability
indecisionconfirmationrangebreakout
Definition
- Single candle.
- Open and close are very close (small real body).
- Wicks can be small or large (different doji variants).
Market Psychology
- Neither side could take control by the close.
- Often appears during transitions: pauses, tops, bottoms, or consolidation.
- Best treated as “wait for confirmation.”
Rules
- Doji alone is not an entry signal.
- Prior trend + level matters (support/resistance).
- The range of the doji can define a breakout box.
Best Context
- At key levels after trend exhaustion.
- During compression before a range expansion.
- At pivot points (break of structure zones).
Confirmation Ideas
- Bullish: break and close above doji high (preferably from support).
- Bearish: break and close below doji low (preferably from resistance).
- Volatility expansion after compression.
Invalidations
- False breakout and close back inside doji range.
- Breakout fails at next key level immediately.
Common Mistakes
- Entering on the doji candle itself with no trigger.
- Ignoring that doji is common and not always meaningful.
- Not defining invalidation (doji range is your reference).