Triple candlestick patterns
Triple candlestick patterns
To identify triple Japanese candlestick patterns, you need to look for specific formations that consist of three candlesticks in total.
These candlestick formations help traders determine how the price is likely to behave next.
Some three candlestick patterns are reversal patterns, which signal the end of the current trend and the start of a new trend in the opposite direction.
And other three candlestick patterns are continuation patterns, which signal a pause and then the continuation of the current trend.
Let’s take a look at the popular triple Japanese candlestick patterns.
Evening and Morning Stars
The Morning Star and the Evening Star are triple candlestick patterns that you can usually find at the end of a trend.
They are reversal patterns that can be recognized through three characteristics.
The first candlestick is a bullish candle, which is part of a recent uptrend.
- The second candle has a small body, indicating that there could be some indecision in the market. This candle can be either bullish or bearish.
- The third candlestick acts as a confirmation that a reversal is in place, as the candle closes beyond the midpoint of the first candle.
Three White Soldiers and Black Crows
The Three White Soldiers pattern is formed when three long bullish candles follow a DOWNTREND, signaling a reversal has occurred.
This type of triple candlestick pattern is considered as one of the most bullish signals, especially when it occurs after an extended downtrend and a short period of consolidation.
For the Three White Soldiers pattern to be considered valid, the second candlestick should be bigger than the previous candle’s body.
For the Three White Soldiers pattern to be completed, the last candlestick should be at least the same size as the second candle and have a small or no shadow.
The second candle’s body should be bigger than the first candle and should close at or very near its low.
For the Three Black Crows pattern to be completed, the last candlestick should be at least the same size as the second candle and have a small or no shadow.
