Business, Legal & Accounting Glossary
The Rising Three Methods candlestick formation is a 5-day bullish continuation pattern.
The rising three methods is a bullish candlestick charting pattern that displays a short term interruption of an uptrend, but not a reversal – it’s a continuation pattern. A long white candlestick, followed by three consecutive short black (or mixed colour) candlesticks, followed by another long white candlestick that closes at a new high, characterizes the rising three methods. Some market technicians, but not all, also require that the fifth candle open higher than the close of the previous day to complete a rising three methods pattern. The short candles in the rising three methods suggest uncertainty about the trend and a potential reversal to the downside. However, the bodies of these candles remain within the high-low range of the first white candle in the rising three methods, suggesting sellers lack the strength to push a security lower. The fifth white candle in the rising three methods shows that buyers have reasserted control and will continue the uptrend. Traders consider a rising three methods pattern to be a very reliable indicator. The bearish counterpart to the rising three methods is the falling three methods.
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This glossary post was last updated: 22nd March, 2020