The Three White Soldiers pattern shows a series of long white candlesticks that progressively close at higher prices. It is also best if prices open in the middle of the previous day’s range (body). This stair-step action is quite bullish and shows the downtrend has abruptly ended.
Rules of Recognition
1. Three consecutive long white lines occur, each with
a higher close.
2. Each should open within the previous body.
3. Each should close at or near the high for the day.
Pattern
The Three White Soldiers pattern occurs in a downtrend and is representative of a strong reversal in the market. Each day opens lower but then closes to a new short-term high. This type of price action is very bullish and should never be ignored.
Three White Soldiers Success Rate After a Downtrend Channel
Success rate is higher when the 3 white soldiers does a breakout from an existing mini down channel. Furthermore, the breakout forms a higher low which indicate that Market Makers want a higher price.
Three White Soldiers in Support and Resistnce that Failed
This is also a breakout of a mini downtrend but the problem is that it is in a Support and Resistance channel and the 3 white soldiers did not break out of the resistance line.
Conclusion
Three White Soldiers success rate does not come immediate as it depends on the subsequent movement by Market Makers. The success rate is very high when the Three White Soldiers following move are higher low after a market downtrend. Never follow a candlestick theory blindly.
Singapore
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Pattern
Analysis