Triple Candle Patterns

Have you ever noticed that a single candle can tell you lots about market sentiment, and a pair of candles can tease you about some changes? Regardless, think what three candles in order can do. I know what you are thinking too; a picture is worth a thousand words, and given that we are watching the market, the story that three candles will tell you can be much more complex and clear.

In addition, when you learn the way of reading the trio formations, the information you have can make it much easier to make decisions. Stick with me for a few moments, and I will teach you how to read the three-bar setups that can transform the noise you track into ideas worth exploring and expanding.

What Makes Triple Candle Patterns Special?

Triple candle patterns are three consecutive candlesticks that, together, can reveal market intentions and, in many cases, signal possible reversals or strong trends. Each candle builds on the previous candle, so the trio tends to reveal stronger and more reliable clues when compared to a single candle or a double candle.

Key Criteria to Consider When Judging Their Strength

For each pattern, consider the following:

• Sequence: is the trio bullish to bearish, or bearish to bullish?

• Size: Are the bodies getting bigger, smaller, or balanced?

• Shadows: Is the length of any wick relevant?

• Color Harmony: are the colors individual, a set, and does it align to communicate urgency, or caution?

• Placement: Is the trio near a swing point or inside a trend?

Morning Star – A Soft Bullish Reversal

A classic, the Morning Star begins with a bearish candle, followed by a small indecisive candle (not an uncommon pattern; typically either a Doji or has a comparatively tiny body) and finishes with a bullish candle. When you see this pattern, it tells you the sellers are losing ground and buyers are coming in.

Evening Star – A Mildly Bearish Shift

Like the Morning Star, the Evening Star shows the bullish strength of the first candle, followed by a small-bodied or indecisive candle in the middle, and a strong selling candle closes. It often occurs at a top, which suggests the bulls may be backing off.

Three White Soldiers – Bullish Momentum in Full Display

The Three White Soldiers pattern is exactly three bullish candles that close higher than the next. Typically, there are small to non-existent lower shadows. A Three White Soldiers pattern indicates a solid change of control to the buyer, especially if it comes after a downtrend or consolidation.

Three Black Crows – An Ominous Bearish Message

The bearish inverse, Three Black Crows, is three bearish candles that close lower than the previous candle with very little upper wicks. It indicates that there is steady selling pressure that is building momentum and is often the start of a downtrend.

Three Inside Up / Down – Hidden Reversal Signals

• Three Inside Up: A bearish candle, followed by a bullish candle that stays within the body of the bearish candle, then a bullish candle closes above the first candle's high. The Three Inside Up is a silent signal of a bearish-to-bullish reversal.

• Three Inside Down: The inverse of the Three Inside Up – bullish candle followed by a small bearish candle that stays within the body, followed by a strong bearish closing candle. Handy to identify new bearish tendencies.

Advanced Block – Signal of Bullish Fatigue

A less appreciated but clear price action signal: three bullish candles with decreasing body-size (or elongating upper shadow) suggest the buyers are pushing, but they are getting fatigued. If this signal forms against some resistance, it might imply a potential consolidation.

Stalled Pattern – Consolidation or Reversal?

Three candles in opposite colors with small bodies, these candles typically cluster together over a short price range, which is a Stalled Pattern; it represents indecision or a pause in the market. If a strong breakout follows these candles, then there was probably building energy behind the scenes. 

Putting Them in Context

 Here are some references when it comes to triple candle action:

• Where are they going to form? Reversal patterns below a swing low and above a swing high carry more weight.

• Is there confirmation? There might be volume spurts, surges, or a strong follow-up candle.

• Compare the trend conditions. Three White Soldiers in a strong Bullish trend have more conviction than in sideways conditions.

•  The patterns are valid. Only trade what sticks out to you and aligns geographically with support or resistance. 

Common Pitfalls to Avoid

Unfortunately, most greenhorn traders will run amok here:

• Ignore trend conditions. Trading a bearish pattern in its looser uptrend may not mean a reversal but merely a pause to the move.

• Don't look for textbook perfection. The candle patterns rarely match your charts pixel for pixel, so adaptability is key.

•  Don't go overboard without confirmation. Wait for signed movement.

Practical Tips to Practice this Material

•  Review historic charts. Scroll back a week or a month and train yourself to memorize the patterns by eye.

•  Use with indicators. The RSI, trend lines, or moving averages can bolster your conviction.

• Be patient. Trust that you will learn to recognize them, but only after many cycles of deliberate, active review, not by random eagerness to force the setup.

• Learn from the misses. Review setups that didn't work out. Most of the time, you will see what led you to become misled.

Conclusion

Triple candle setups are a visual magnifying glass into market psychology and behavior. Morning and Evening Stars imply belief in a shift, Three Soldiers or Three Crows signify momentum, Advance Blocks suggest exhaustion, and Stalled Patterns suggest disengagement.

When you can identify price action patterns this way, charts become more than a colloquial pictograph; instead, they become tangible forms of convertible conversations.

The next time you look at a chart, linger long enough to see if there are groups of candles that are of interest to you. Please pay attention to each one's shapes, sequence, and position, and what they collectively speak to you about conviction, caution, or change.

To master Triple Candle setups is to grasp more than signals; it is to evoke stories into your trading so that you do not just react, but listen as well.