What is the falling three methods pattern?

The Falling Three Methods pattern is a bearish continuation pattern that appears in a downtrend. This Japanese candlestick pattern consists of at least five candlesticks but may include more. A long black body is followed by three small body candles, each fully contained within the range of the high and low of the first candle.

How many candles are in a falling three methods pattern?

The falling three methods pattern consists of 5 candles. The first candle, which is a tall bearish one, is followed by three smaller positive candles, that are confined within the range of the first candle. The last candle is a tall bearish one, that pierces the low of the pattern.

How effective are falling three & rising three methods?

The falling three and rising three methods are very effective, as they perfectly match the basic characteristics of a trend. Even though it can often be difficult to find the exact price formation, the success rate will be higher for this candlestick pattern — especially if the market trend is stronger.

What is a rising three methods pattern?

The rising three methods pattern is also a combination of at least five candlesticks, with two bullish and three (or more) bearish candles, as shown in the image below. More specifically, the first bullish candle is followed by at least three bearish candles, and the final bar is a bullish candlestick.