Dragonfly Doji Candlestick: What Does It Mean?

Of course, crypto traders often rely on technical analysis indicators to create lucrative strategies. However, candlestick patterns are hard to ignore, as they can often provide better signals, especially when used in combination with the technical indicators. One of the most popular candlestick patterns is the Dragonfly Doji, which can be easily distinguished on the candlestick chart.

The Dragonfly Doji is regarded as a reversal pattern that shows up at the bottom of downtrends and anticipates a rebound or a rally. The ideal Dragonfly should have an invisible body and a long lower shadow. Thus, the pattern indicates that the open, high, and close prices are relatively at the same level.

What Does a Dragonfly Doji Look Like?

When analyzing the chart, all traders can quickly determine a Dragonfly as it represents a T-shaped pattern. It has a very long lower shadow, while the open, close, and high tend to be at the same level. However, the ideal Dragonflies are quite rare. But the primary condition is that the open and close should be very close to each other, while the high must coincide with the close or at least draw a very short upper shadow. Here is what the pattern looks like on the chart: