There is a candlesticks pattern that is called the Three White Soldiers. It typically occurs when the strong downtrend is reversing into the strong uptrend.
Today, I want to teach you some basic rules about trading with the three white soldiers pattern.
Key Takeaways🔑
| →The Three White Soldiers is a bullish trend reversal pattern, usually occurring when a strong downtrend shifts into a strong uptrend. |
| →It consists of three consecutive green (or white) candles, each opening and closing at a higher point than the previous one. |
| →It’s an indicator to place a buy order, but traders should always validate with other technical analysis tools. |
Contents
How to recognize the three white soldiers candlesticks pattern
As the name suggests, the pattern is formed by three candles. The candles are developing one after another and are green in color. Normally, the following candle’s open and close points are higher than the open and close of the former one. Moreover, none of the three candles can be a special one like Doji or pinbar.
Pros and Cons of the Three White Soldiers Candlestick Pattern
👍 Pros:
- Reliable indication of a strong bullish trend reversal
- Easy to identify with a clear visual pattern
- Allows traders to enter the market at the beginning of an uptrend
👎 Cons:
- May not be as reliable during periods of market volatility
- Could lead to false signals if not confirmed by other indicators
- Not recommended for beginners without proper understanding and practice
| Candlestick Patterns | Description |
|---|---|
| Three White Soldiers | A bullish reversal pattern consisting of three consecutive green candles with higher opens and closes. |
| Three Black Crows | A bearish reversal pattern consisting of three consecutive red candles with lower opens and closes. |
| Doji | A pattern that signifies uncertainty in the market, depicted by a candle with virtually the same open and close price. |
| Hammer | A bullish reversal pattern that appears during a downtrend, represented by a candle with a small body and a long lower wick. |
How to use the three white soldiers candlesticks pattern in trading on the Olymp Trade platform
It was mentioned earlier, that the three white soldiers pattern usually appears when the downtrend is coming to an end and the uptrend is developing. It is a bullish trend reversal pattern. This means that when you identify this pattern, it is time to place a buy order. In the above chart, I was trading 15-minute candles and when I spotted the three white soldiers, I could successfully enter the trade for 30 minutes or even longer.
Where exactly should you enter the trade? Any of the three soldiers would be a good point. Nevertheless, the ideal situation would be to enter at the first candle in the pattern.
Having learned the basic knowledge about the three white soldiers candlesticks pattern, test it on the Olymp Trade demo account. Share your opinions with us.
Best of luck!
Questions and Answers
- Q: What does the Three White Soldiers pattern indicate?
- A: It’s a bullish reversal pattern that signifies a strong shift from a downtrend to an uptrend.
- Q: How to trade when you spot the Three White Soldiers pattern?
- A: It’s generally an indicator to place a buy order. However, it’s recommended to confirm with other technical analysis tools before making a decision.
- Q: Is the Three White Soldiers pattern reliable during market volatility?
- A: It might be less reliable during high volatility as it could lead to false signals. Always confirm with other indicators.
- Q: Is the Three White Soldiers pattern easy to identify?
- A: Yes, it’s relatively easy to spot due to its clear visual pattern of three consecutive green candles.
- Q: Can beginners use the Three White Soldiers pattern?
- A: While it’s a useful pattern, it’s not recommended for beginners without proper understanding and practice. It’s always best to test strategies on a demo account first.