Three consecutive strong bullish candles, each closing at or near its high with minimal upper wicks, signal sustained buying pressure. After a base/consolidation, this pattern often marks the start of a new leg up.
- Price consolidating or pulling back for 5+ days prior
- Three consecutive large bullish candles form
- Each candle closes near its high (small/no upper wicks)
- Each candle opens within the prior candle's body
- Volume expanding through the three candles
- Enter long on close of third candle OR next candle open
- Stop: below the low of the first soldier
- Target: prior swing high, then measured extension
- Price already extended > 3 ATR above EMA 20 (mean reversion risk)
- RSI(14) > 80 before the third candle forms (overbought exhaustion)
- At major resistance that has historically caused rejection
The cleanest 3WS forms after an extended base. Not from already-trending prices. The pattern's power is in its confirmation of a new directional thrust. After an extended rally already in progress, 3WS is more likely a blow-off top than a fresh continuation.