Contents
The 3 White Soldiers Candlestick Pattern is a pattern that signals a strong uptrend reversal. This pattern usually forms at the end of a strong downtrend.
This guide will show you how to recognize this pattern and how to trade using it on the IQ Option platform.
Key Takeaways🔑
| →The 3 White Soldiers pattern is a strong bullish reversal signal at the end of a downtrend. |
| →Consists of 3 consecutive bullish candles with each opening and closing higher than the previous. |
| →Trade cautiously, apply risk management, and always perform your own analysis before executing a trade. |
Identifying the 3 White Soldiers Candlestick Pattern
What are 3 White Soldiers candlestick?
The Three White Soldiers pattern consists of 3 bullish consecutive candles. They will usually appear at the end of a strong downtrend. The opening price of each candle is usually higher than the opening of the previous candle. In addition, the close of one candle is higher than the close of the previous candle.
For a valid 3 White Soldiers Candlestick Pattern to form, all three bullish candles must not be special (for example doji or pin bars).
What about the 3 Black Crows?
3 Black Crows candlestick formation is twin paternity to the one discussed today. Thus 3 Black Crows is a bearish reversal pattern. It requires an uptrend first. This trend is broken by 3 downward candles which have long bodies. If you want to know more, we have prepared an article describing the 3 Black Crows pattern in detail.
How to trade using the 3 White Soldiers Candlestick Pattern on IQ Option
The 3 White Soldiers Candlestick Pattern is a bullish trend reversal pattern. So whenever you see them, you should place a long buy position. Using the chart above, I'm using 15-minute candles. This means that I can enter a buy position lasting 2 hours or more.
The best place to enter your buy position is on any of the three soldiers. However, it's best if you enter into a trading position with the first soldier. Of course, that would be best, but it is impossible. After all, when the market draws candles we do not yet know if and what, if any, pattern will be drawn. All that remains is to wait.
If a complete pattern appears on the chart, you have two options. The first is to take a buy position immediately after the close of the last of the 3 candles of the pattern. The second option is a little safer. The second is to take a buy position as soon as the market hits the top price of the pattern. At that point, the 3 White Soldiers are also considered to be confirmed.
Pros and Cons of the 3 White Soldiers Pattern👍👎
| Pros | Cons |
|---|---|
| 👍 Strong bullish reversal signal | 👎 Might be less effective in ranging markets |
| 👍 Easy to identify with practice | 👎 No pattern guarantees success |
| 👍 Can be combined with other indicators | 👎 Reliability varies across assets and timeframes |
| Bullish Reversal Patterns | Bearish Reversal Patterns |
|---|---|
| 3 White Soldiers | 3 Black Crows |
| Hammer | Hanging Man |
| Morning Star | Evening Star |
| Bullish Engulfing | Bearish Engulfing |
How effective is the Three White Soldiers pattern?
There are various studies on the effectiveness of candlestick formations. However, there are no complete statistics that examine the performance of patterns across all assets and different time frames. However, it can be stated in some simplification that the 3 White Soldiers Candlestick pattern works as a bullish reversal in more than 80% of cases. That's quite a lot and no surprise here. The 3 strong upward candles show a clear advantage for buyers in the market. It is therefore worth taking advantage of this fact.
Now that you've learned how to identify and trade using the Three White Soldiers pattern, try it out on your IQ Option practice account. Share your results in the comments section below.
Good luck!
Q&A: Frequently Asked Questions About the 3 White Soldiers Pattern
- 💡 Q: How do I confirm the 3 White Soldiers pattern?
A: Wait for the completion of the third bullish candle and ensure that each candle opens and closes higher than the previous one. - 💡 Q: Can the 3 White Soldiers pattern be used in any market or timeframe?
A: While it can be observed in various markets and timeframes, its effectiveness may vary. Always analyze the context and use additional confirmation tools. - 💡 Q: Can the 3 White Soldiers pattern be combined with other technical indicators?
A: Yes, it is highly recommended to combine this pattern with other technical indicators to increase the probability of success. - 💡 Q: How do I manage risk when trading the 3 White Soldiers pattern?
A: Apply proper risk management techniques, such as setting stop-loss levels and defining position sizes based on your account equity and risk tolerance. - 💡 Q: How can I practice identifying and trading the 3 White Soldiers pattern?
A: Use a demo account or paper trading platform to practice identifying and trading the pattern without risking real money.