I noticed an interesting point on the charts — the Evening Star pattern is once again appearing on several assets. This is one of those signals that you should really keep an eye on if you take technical analysis seriously.

For those who are not in the know: the Evening Star pattern is a three-candle formation that often precedes a trend reversal from bullish to bearish. The idea is simple: first, a strong green candle (bulls still in control), then a small candle with a short body (uncertainty, no one knows where it’s headed), and finally, a third red candle breaks below the first candle’s closing level. This is a signal that the momentum is waning.

Currently, BTC is trading around 68.81K with a decrease of 0.21% over the day. The situation with PEPE is similar — the asset has fallen by 4.32%. It’s during moments like these that the Evening Star pattern becomes especially useful for identifying exit points.

Why does this work? Because it’s not just a random set of candles — it reflects market psychology. When such a formation appears, it indicates that the bulls are losing control. Traders who entered during the rise start closing their positions, creating downward pressure.

Practically speaking, when you see the Evening Star pattern, it’s a signal to sell or exit long positions. You can wait until the third candle fully closes below the first candle’s level, then make your decision. This helps avoid large drawdowns and manage risks properly.

If you’re just starting with technical analysis, this pattern is one of the most reliable tools for spotting reversals. I recommend adding it to your set of signals and monitoring charts for such formations. On Gate, you can conveniently track these moments across different assets.