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The shooting star formation (bearish pin bar) is formed when?

a) At the top of an uptrend
b) At the bottom of a downtrend
c) In a sideways market
d) During a strong bullish rally

1 Answer

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Final answer:

The shooting star formation (bearish pin bar) is formed at the top of an uptrend and indicates a potential trend reversal.

Step-by-step explanation:

The shooting star formation, also known as a bearish pin bar, is formed at the top of an uptrend. It is a candlestick pattern that indicates a potential trend reversal and can be used as a bearish signal. The shooting star has a long upper shadow and a small real body located near the low of the candle.

For example, if the price of a stock has been steadily rising and reaches a new high, but then forms a shooting star candlestick, it suggests that the buying pressure is weakening and that a bearish reversal might occur.