Each approach aligns the Three White Soldiers formation with broader analysis to minimize risk from random spikes. Experienced traders prefer their patterns to start and move with a sense of urgency. For this reason, you could initiate a position into the runup of the three white soldiers, adding as volume confirms. The difficulty with buying the Three White Soldiers is that they are very wide-bodied candles. As you notice from the examples above, waiting for the last soldier to form may create an emotional hurdle if you plan to set your risk at the low of the day. The first rule for the pattern is that you need clean candles with decent size.

Bullish significance: why it signals reversal

Each bullish candlestick has a close higher than its opening price and closes above the previous candle. Before this pattern forms, the chart will often show several bearish candles or a series of small indecisive bars that reflect fading selling pressure. Once the first soldier prints, it’s followed by two more bullish candles, each opening within the previous candle’s real body and pushing to a higher close. These whales can take advantage of the expected reaction from retail investors and traders by taking a counter position.

In practical terms, these statistics do not guarantee profits on every occurrence. They do highlight that the pattern can be a dependable bullish indication if it aligns with supportive technical or fundamental data. For best results, combine the formation with volume confirmation and technical indicators. To find the Three White Soldiers pattern in a chart, start by looking at areas where the market has been in a clear downtrend or moving sideways after a drop. The pattern often appears after several Best setting for macd sessions of bearish activity, or when the price has stalled following a steady decline. You may notice smaller candles or indecisive moves just before the shift, which often signals that sellers are losing control.

Can the Three White Soldiers pattern form during a consolidation phase?

If that retest holds and price starts climbing again, it confirms the breakout wasn’t a fake move. Use this opportunity to enter a long position as the market shows commitment above the prior ceiling. Another limitation is that the pattern does not provide any entry or stop-loss logic on its own. Traders must overlay personal rules for risk management, confirmation, and exit planning.

Three black crows are three long-bodied candlesticks that open within the real body of the prior candle and close lower. Whereas three white soldiers catch the momentum shift from the bears to the bulls, three black crows show the bears taking control from the bulls. The same caveats about volume and additional confirmation apply to both patterns, though confirming volume is more important in the bullish pattern.

Do gaps between candles affect the Three White Soldiers pattern?

• Hence, the pattern cannot serve as a sell signal if it occurs in an uptrend, as it is not recognized as the three white soldiers in this context.
• This indicates that, despite selling pressure, buyers were able to push the price up significantly during the session, though the price fell back to near its opening level.
• It, therefore, would be helpful to confirm the pattern with other technical analysis tools.
• Each bullish candlestick has a close higher than its opening price and closes above the previous candle.
• The Three White Soldiers pattern forms over the course of three green bullish candles, each closing higher than the last.

However, after the three white soldiers formed, it failed to serve as a trend reversal pattern and drive an upward trend. Traders and analysts in the currency market, stock market, and various other financial markets frequently use this candlestick pattern for technical analysis. Three white soldiers patterns, also known as three advancing soldiers patterns, are candlestick patterns on stock charts. This is especially true if the third candle’s close is nearing a key resistance level based on market structure.

Trading The Three White Soldiers Based on Support and Resistance Levels

No, it shows near-term buying pressure across three consecutive sessions but does not assure extended gains. Strong overhead resistance or negative macro factors might limit the follow-through. Many traders combine it with other signals for a complete forecast.

The stock had a high volume down event followed by three white soldiers. One of the first interesting points is that the stock has a sharp move upward at the open and then immediately rolls over. Contextually, it can come when there is a lack of supply in the market after a heavy sell off, signaling a big reversal. These candles all need to finish in the positive and the candles cannot breach the low of the prior candlestick. Next, we will dive into three clear requirements you should look for when the candles present themselves on the chart. She holds a Bachelor of Science in Finance degree from Bridgewater State University and helps develop content strategies.

• A rally that begins in the middle of an uptrend offers little edge because buyers already control price.
• Many beginners start with a small percentage of their trading portfolio, like 1% to 2%.
• In trading, spotting the Three White Soldiers early can help you catch a potential upward move before it gains full momentum.
• Look at a higher timeframe to be sure you are not buying into a long-term resistance zone.
• Watch candle bodies too; very small bodies or long upper shadows hint that buying is losing force.

This structure shows sustained buying strength across three sessions, often showing the beginning of a new uptrend or the end of a recent pullback. The absence of long upper wicks suggests little resistance during the push, and each close near the high reinforces bullish control. This written/visual material is comprised of personal opinions and ideas and may not reflect those of the Company. The content should not be construed as containing any type of investment advice and/or a solicitation for any transactions.

Rather than relying on it in isolation, treat it as one piece of the larger picture in your trading decisions. The success rate of the Three White Soldiers pattern varies depending on market context, timeframe, and confirmation tools. The Three White Soldiers pattern forms over the course of three trading sessions and is best understood by looking at the behavior of each individual candle. With the pattern identified, fantastic forex traders enter long when the price moves below and above the pattern’s low, setting a stop loss of one ATR. We can see the three white soldiers pattern on the Agilysis (AGYS) daily price chart on July 8th, 2013. On higher timeframes, the move might still sit inside a larger downtrend, so always zoom out to check direction.

It consists of three consecutive long-bodied bullish candles, each one closing higher than the previous day. Three White Soldiers and Three Black Crows are opposite in both structure and meaning. The Three White Soldiers marks a shift from selling to buying after a downtrend, while the Three Black Crows signals a reversal from bullish momentum into strong selling after a rally.

Does volume always confirm the Three White Soldiers candlestick pattern?

Trading without candlestick patterns is a lot like flying in the night with no visibility. Sure, it is doable, but it requires special training and expertise. Recently, we discussed the general history of candlesticks and their patterns in a prior post. We also have a great tutorial on the most reliable bullish patterns.

The three white soldiers candlestick pattern is typically observed as a reversal indicator, often appearing after a period of price decline. This chart pattern suggests a strong change in market sentiment in terms of the stock, commodity, or forex pair making up the price action on the chart. Three white soldiers is a bullish candlestick pattern that is used to predict the reversal of the current downtrend in a pricing chart. The pattern consists of three consecutive long-bodied candlesticks that open within the previous candle’s real body and a close that exceeds the previous candle’s high. These candlesticks should not have very long shadows and ideally open within the real body of the preceding candle in the pattern.

Then, we can see the three white soldiers pattern form, leading to an eventual upward trend. Hence, similar to the first example, the three white soldiers has succeeded in serving as a reversal pattern. The Three White Soldiers pattern is a popular bullish candlestick pattern. It is fairly easy for most traders to spot in real time given the 3 large range successive candles. Moreover, in the right context it can signal a reversal of a trend. In this post we’ll discuss the context, requirements, and a free video on how to trade this pattern.

The candles only signal that bulls showed strength for a short period, leaving you to interpret how far that strength might carry. Pairing the Three White Soldiers pattern with the right indicators helps confirm its reliability and avoid false setups. The pattern reflects price action, but indicators offer insight into strength, volume, and trend alignment.