Last doji we are going to analyze is named long legged doji or rickshaw man. This is a doji with an open
and close at the middle of the candle's range or very close to the middle of the candle.
There's no real body or a very small real body and there are two long shadows that we can also call
legs,
that's why the name long legged doji. This pattern has a condition that you will not find so easily in
other patterns.
The long legged doji is a reversal pattern whether it appears during a downtrend or an uptrend.
Let's see the reason of this condition.
The long upper shadow shows that the price rallied during the session.
The long lower shadow shows a market that has sold off during the session.
In other words the market rallies, sells off, rallies, sells off and continues like this only to close the
session at the opening price.
So after a downtrend or after an uptrend this doji indicates that there has been much uncertainty
in the market,
after a period of directional certainty. This change of conviction may result in a change of trend.
Here we have euro-dollar on a daily chart, you can see a long legged doji appearing at the end of an uptrend,
creating uncertainty on the market. That could be the price where sellers find convenient to sell,
increasing the supply and pushing the price down.