Three White Soldiers

The Three White Soldiers is a continuation pattern composed of three green Japanese candlesticks.

It represents a sound rise in prices. It is significant over all time units.

Its characteristics are as follows:

• The three candlesticks must be green.

• Each candlestick must open close to the previous close (no wide gap).

• Each candlestick must close near the highs of the session.

• To announce a sound uptrend, this pattern must appear in a lower price zone, after a stability zone.

On this chart, we can observe the Three White Soldiers twice after price stability zones.

The first one does not generate a sound trend; a Dark Cloud Cover breaks the bullish impulse. Then prices fall slightly before finding a support zone at €9 where a new pattern starts that is going to trigger a sound and extended trend. Prices close near their highs and the rise is steady since it is not too sharp and it occurs without any gap.

Nine candlesticks after, there is a long green candlestick with quite a wide gap. At this moment, the trend is no longer sound and it may be interesting to place more stops in order to protect the gains one made during the rise. One will then be able to come back on lower positions when the situation gets sounder, which is what occurs here after the pullback at €10.