Doji Candlestick
A Doji is a candlestick in which the opening and closing prices are equal or nearly equal, producing a cross or plus-sign shape that historically indicated equilibrium between buyers and sellers within a single session.
The Doji is among the most widely recognized single-session candlestick formations. Its defining characteristic is a near-identical open and close price, which produces a candlestick with virtually no body and wicks extending above and below. The visual result is a cross or T-shape depending on the length and symmetry of the shadows.
Historically, the Doji was interpreted as a session in which neither buyers nor sellers gained the upper hand. The price moved away from the open in both directions at some point during the session — the wicks attest to that activity — but ultimately returned to the opening level by the close. This equilibrium was considered significant when it appeared after a directional run, because it suggested that the force driving the prior move may have temporarily exhausted itself.
Several Doji variants were catalogued in the historical candlestick literature. The Long-Legged Doji features long upper and lower wicks, reflecting wide intraday swings that resolved at the open. The Gravestone Doji has a long upper wick and no lower wick — the session opened at the low, rallied, and then closed back at the low — and historically appeared near price highs. The Dragonfly Doji has a long lower wick and no upper wick — price fell from the open, recovered fully by the close — and appeared historically near price lows.
The Four-Price Doji, where open, high, low, and close are all identical, is the rarest variant and indicates an extremely illiquid or narrow session with virtually no price movement.
The Doji rarely carried analytical weight in isolation in historical studies. Its interpretation depended heavily on its position within the prior trend, the candles immediately preceding and following it, and the broader market context. A Doji appearing after ten consecutive bullish sessions near a multi-year resistance level was treated very differently from one appearing in the middle of a sideways range, where equilibrium is the norm rather than an exception.