The Three White Soldiers pattern is a bullish candle formation on a trading chart that occurs at the low point of a bearish trend
What does the three white soldiers pattern mean?
The three white soldiers pattern or pattern can help you detect if there is a price reversal after a downtrend. But do you know what this pattern means?
What is the Three White Bull Soldiers pattern?
This pattern is a bullish candle formation on a trading chart that occurs at the lowest point of a downtrend. As the name suggests, the pattern consists of 3 white or green colored candles.
The opposite pattern to the 3 white soldiers is the 3 black crows pattern, which is represented by 3 consecutive red candles at the top of the bullish trend.
Why the name of the three white soldiers?
"The name given to the three white soldiers" means that there is a steady increase in buying pressure after a bearish trend has occurred. In addition, these bullish patterns indicate a reversal in price movement; therefore, some investors go long to take advantage of bullish trajectories when they detect the pattern of the three white soldiers.
Identify the three white soldiers chart
If you need to recognize this pattern, you need to identify the three white candles on the chart or they are often represented in green and are consecutive. Each of these candles opens and closes at a higher point than the previous one. Likewise, the closing of the 3 candles must coincide with the high or be very close to it.
Keep in mind that the larger the bodies of the three candles, the more strength the figure has, and the greater the distance between the candle closures, the more reliable the pattern will be.
So that you can better understand how to identify this pattern, we will summarize the four conditions that the candles must have:
- To recognize that we are facing a pattern of three white soldiers, we must have:
- Three consecutive long white candles.
- Each candle must close near the session high and generate a new high.
- The candle opening must occur within the previous day's session.
The current trend can be bullish or bearish. In case the trend is upward, it usually brings a pullback (previous downward price movement) or a period of price consolidation before the market resumes its upward movement through this formation.
Also, consider the following:
- The bodies of the second and third candles should be approximately the same size.
- If the third candle is visibly smaller than the previous two, it may mean that sellers do not have complete control of what would indicate weakness among sellers.
- Candles have lower or zero wicks.