| The top and bottom of a trend are often difficult to | | | | next day. The huge movement is caused by short |
| predict accurately until the patterns within the chart | | | | covering. Other shorts will move in to start new |
| become more concrete. It is fairly easy to find out | | | | positions at the higher price levels. |
| where the support and resistance lines lie; but it is | | | | Bearish Side By Side White Lines - In a downtrend, a |
| frequently unclear whether these tests will actually | | | | long black candle forms. The 2nd day is a white |
| break a current trend. You simply won't know for | | | | candle that opens with a huge gap down which fails |
| certain until the line is crossed. However, Japanese | | | | to fill in completely. The 3rd and final day of the |
| candlestick continuation patterns do offer strong | | | | pattern is another white candle that basically repeats |
| clues as to what is about to occur as those support | | | | the 2nd day. The 3rd opening and close should be |
| and resistance points draw near. | | | | nearly the same as the 2nd day while the gap down |
| The differences between continuation and reversal | | | | remains unfilled. |
| patterns can be subtle. Learn these distinctions well | | | | Bullish Japanese Candlestick Continuation Patterns |
| so you don't jump to a conclusion based on ignorance | | | | Rising Three Methods - This is simply a short |
| or misidentification. | | | | interruption in a bullish trend similar to Falling Three |
| Bearish Japanese Candlestick Continuation Patterns | | | | Methods but in the opposite direction. 5 candles make |
| Falling Three Methods - This is simply a short | | | | up this continuation pattern. The 1st day is a long |
| interruption in a bearish trend. 5 candles make up this | | | | white candle. The 2nd is a black candle that opens |
| continuation pattern. The 1st day is a long black | | | | with a slight gap up. The gap gets filled and continues |
| candle. The 2nd is a white candle that opens with a | | | | trading downward to close within the lower range of |
| slight gap down. The gap is filled but the trading | | | | the 1st day. The 3rd day can be of either color but |
| continues upward to close within the lower range of | | | | must trade completely within the range of the 1st |
| the 1st day. The 3rd day can be of either color but | | | | day. The 4th day is a white candle that also trades |
| must trade within the range of the 1st day. The 4th | | | | within the range of the 1st day but usually a little |
| day is a white candle that also trades within the | | | | lower than the 2nd and 3rd days. Day 5 is a long |
| range of the 1st day but usually slightly higher than | | | | white candle that closes above the 1st and 2nd day, |
| the 2nd and 3rd days. Day 5 is a long black candle | | | | clearly resuming the bullish trend. |
| that closes below the 1st and 2nd day, clearly | | | | Bullish Mat Hold - This is a resting pattern for the bulls |
| resuming the downtrend. | | | | and is similar to Rising Three Methods. The only real |
| Bearish Tasuki Gap - A 3 day trading gap candle | | | | differences are that the initial gap up between the |
| formation creates a strong continuation signal. The | | | | 1st and 2nd day does not immediately get filled and |
| first 2 days are black candles that create a significant | | | | the 5th day tends to rise more significantly. The bulls |
| gap between them in trading. The 3rd day is a white | | | | appear to be (comparatively) a little stronger in this |
| candle that fails to fill in that gap and the day closes | | | | pattern. |
| within it. | | | | Side by Side White Lines - In a bullish trend, a white |
| Three Line Strike - In a downtrend, a Three Black | | | | candle forms the 1st day. A gap opens between it |
| Crows pattern forms. The 4th day opens below the | | | | and the next day with another white candle. The 3rd |
| close of the 3rd day. It demonstrates a powerful | | | | day repeats the 2nd day, with their openings at |
| move upward on a single day that closes above the | | | | approximately the same price. The important feature |
| opening of the 1st day. Because the 4th day's white | | | | is that the gap up remains unfilled (indicating |
| candle is so large (barring any news to justify that | | | | significant strength after a failed attempt at reversal). |
| move) it is assumed the downtrend will continue the | | | | |