Rising Three Methods
Tue, Apr 15The Rising Three Methods pattern is a bullish continuation pattern that emerges during an uptrend. This Japanese candlestick formation consists of a minimum of five candlesticks, though it can include more.
The pattern begins with a long white body, followed by three small body candles, each entirely contained within the range of the high and low of the initial candle. The fifth candle closes at a new high.
Recognition Criteria
The Rising Three Methods pattern comprises a total of five candlesticks: two long and three short. More specifically, it consists of one long candle, three short candles, and then another long candle.
To identify the Rising Three Methods pattern, look for the following criteria:
- Observe a series of five candles in an upward price trend.
- The first candlestick in this pattern is a bullish candle with a large real body.
- This first candle is followed by three or more short black (or red) candles. The subsequent three candlesticks should be smaller, bearish, and dark in color, remaining within the high and low of the first candlestick.
- The short candles should be succeeded by another long bullish (white or green) candle.
- The final candlestick that completes the pattern must close above the previous candle and above the close of the first candlestick.
Meaning
Since this pattern begins with a long white candle, it indicates that the bulls are stronger than the bears. Following the first candle, the price pauses momentarily, forming the three short candles in the center, which remain within the range of the first candle.
The bears are unable to push the price below the bottom of the initial long candle, and they are ultimately overpowered by the bulls. Consequently, the price rises again, resulting in another long white candle that closes above the first candle.
The Three Methods Pattern
The Three Methods pattern consists of at least five candlesticks but may include more. It is a trend continuation pattern that can manifest in either an uptrend or a downtrend.
In an uptrend, it is referred to as the Rising Three Methods pattern, while in a downtrend, it is known as the Falling Three Methods pattern.
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