The Bullish Rising Three Methods Pattern is a continuation
pattern representing a pause during a trend without
causing a reversal. The pattern is characterized by
a long white candlestick followed by three small bodies
in three consecutive days. The small bodies represent
some resistance to previous uptrend and they may even
trace a short downtrend. These three reaction days usually
have black candlesticks but the bodies remain within
the high and low range of the first day's white candlestick.
The pattern is completed by a white candlestick on the
fifth day, opening above the close of the previous day
and closing at a new high. The small downtrend between
the two long white candlesticks represents a break during
the uptrend. The upward trend then resumes and continues.
Recognition Criteria:
1. Market is characterized by uptrend.
2. We see a long white candlestick in the first day.
3. Then we see small real bodies defining a brief downtrend
but staying within the range of the first day on the second,
third and fourth days.
4. Finally we see a long white candlestick on the fifth
day opening above the close of the previous day and also
closing at a new high.
Explanation:
The Bullish Rising Three Methods Pattern typically
represents a rest in the market action. This may be
used to add new positions by longs. The pattern is the
reflection of doubts about the ability of the trend
to continue. This doubt may increase because of small-range
reaction days. However, given the fact that a new low
cannot be made, the bullishness is resumed and new highs
are set quickly.
Important Factors:
The high-low range includes the shadows.
The reliability of
this pattern is very high, but a confirmation in the
form of a white candlestick with a higher close or a
gap-up still is suggested.
Disclaimer
The candlestick patterns explained herein are intended
to inform. They come with no warranty of any kind. If you should choose
this information for your investment decisions, you do so at your
own risk. Investing can be a very dangerous venture and it is you
who must assume the entire cost and risk involved in all of your investment
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