Chapter 9

Getting the Hang of Bullish Three-Stick Patterns

In This Chapter

bullet Three-day patterns that signal the end of a downtrend

bullet Predicting an uptrend continuation using three-day patterns

The addition of three-stick candlestick patterns to your trading arsenal makes your trading strategies more complicated, more interesting, and hopefully, more profitable. In this chapter, I cover some of the bullish three-stick patterns that you can use to make effective and efficient trades.

The three-stick patterns are a little more of a challenge than their one- and two-stick counterparts because there are several rules that each must follow in order to emerge as a valid signal. Three-stick patterns can also be a bit frustrating. You may watch the first two days of your favorite (and most reliable) pattern begin to emerge only to see it fizzle out on the third day. But if you’re up to the challenge and willing to deal with the occasional annoyance, these patterns can be valuable tools when trying to predict trend reversals or confirm that a current trend is going to stay in place.

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