Independent Forex Trading

Three White Soldiers Candlestick Pattern

The three white soldiers candlestick pattern is composed of three large bodied candlesticks all closing higher and with relatively small upper and lower shadows.

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Three White Soldiers Candlestick Pattern Analysis

The three white soldiers candlestick pattern represents a possible reversal to the upside. Similar to other reversal patterns, the three white soldiers candlestick pattern is most significant when it is preceded by an established trend - in this case, a down trend.

Confirmation

The three white soldiers candlestick pattern becomes increasingly relevant when the following occur:

  • All three candles contain large bodies with closing values higher for each time period. The upper and lower shadows are absent or relatively small.
  • It is preceded by a strong down trend.
  • Oversold indicators confirm a change in market direction.

Forex Trading Ideas

The three white soldiers candlestick pattern may be traded alone, or with a combination of signals and/or indicators. For example:

  • Step 1 – Wait for a three white soldiers candlestick pattern to appear during an established down trend.
  • Step 2 – Confirm oversold conditions using the Relative Strength Index Indicator.*
  • Once conditions 1 – 2 are met place an entry order.

*Additional confirmation ideas – confirm the three white soldiers candlestick pattern when it appears outside of the Bollinger Band or when the Stochastic Oscillator signals an oversold condition.

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Customization

By adding additional confirmation signals and indicators the evening star candlestick pattern has the potential to become increasingly accurate in predicting a trend reversal. FxSpyder provides integrated customization tools for hands free trade automation using the JavaScript Object Model. Full details are included in the Help Section of the FxSpyder trading application.

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