Three sessions: a heavy fall, a small indecisive day, then a strong recovery. The middle candle is the point — selling pressure stalled before buyers arrived.
The first candle is a wide down day. The second has a small body, ideally gapping below the first, and its colour is irrelevant. The third is a strong up day closing well into the first candle's body — the deeper it closes, the stronger the reading.
The sequence describes a handover rather than a single event, which is why it is generally considered more reliable than one-candle signals. Three days of evidence is harder to manufacture than one.
Look at where the third candle closes relative to the first candle's midpoint. Above it is the classic form; a close that barely recovers is a much weaker version of the same shape.
Gaps are rarer on NSE than on markets with longer overnight sessions, so many Indian morning stars form without the textbook gap. That is acceptable, but it does weaken the pattern.
It fails when the third candle's rally is driven by short covering into a still-falling stock. Watch whether the advance holds over the following two or three sessions rather than treating day three as the signal.
In a sharp market-wide selloff, morning stars appear across dozens of stocks simultaneously and mean little individually — they reflect an index bounce, not company-specific demand.