Three Soldiers Candlestick Pattern

The “Three Soldiers” candles pattern is actually one that requires three candles, and is a bullish reversal pattern. Because of this, it appears of the bottom of a downtrend, and require three consecutive bullish candles. In order to be a viable buying opportunity, the third candle needs to be roughly the same size as the second one, as it shows that the buyers are still well in control. If it is not, then it shows that momentum could be running out, which is not what you want to see in a reversal signal.

Three Soldiers Pattern

Three Soldiers Pattern

Typically when this pattern appears, it is a sign that the market is shifting its focus, and that the buyers are starting to take control again. As you can see on the chart below, there was a significant surge higher, and then once we broke out above the top of the third candle, the market just simply took off to the upside. The pattern is more common on short-term charts, so it does tend to be an excellent signal for short-term traders. However, on longer-term charts it is every bit as effective and potent. This is a signal that shows an impulsive move higher, and typically is reflective of a sudden change in psychology.

Trade using "Three Soldiers" pattern.

Trade using “Three Soldiers” pattern.

Please keep in mind that you don’t want to see wicks of any real length at the top of the candles, as it would show that perhaps the market isn’t completely convinced yet.

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