(Bearish)
Three Inside Down |
Characteristic of Candlesticks: Reversal
Relevance of Candlesticks: Bearish
Prior Trend of Candlesticks: Bullish
Reliability of Candlesticks : 2nd Grade
Confirmation of Candlesticks: Reliable
Candlestick Patterns Key Reference |
DESCRIPTION
(Bearish) Three Inside Down pattern is a confirmation of a top reversal after a Harami is form in a trend.
The third candlestick act as a confirmation when harami pattern is formed.
PATTERN RECOGNITION
1. (Bearish) Three Inside Down pattern can be identified by a uptrend followed by a top reversal.
2. Refering to above diagram, firstly we will see a bullish candlestick then the second candlestick formed a Bearish Harami pattern.
3. Then we will see the third bearish candlestick with a lower close than the second candlestick which act as a confirmation of top reversal.
EXPLAINATION
The (Bearish) Three Inside Down pattern is formed at the top of a uptrend.
The two candlestick formed a Bearish Harami pattern and the third candlestick act as a confirmation of a top reversal due to the fact that the third candlestick close lower than the past two candlesticks.
The 2nd grade reversal patterns are reliable group of reversal patterns.
POINT TO NOTE
The reliability of (Bearish) Three Inside Down pattern is very high, but a confirmation is still required in a form of a bearish candlestick which a lower close or a gap down is suggested.
CANDLESTICK PATTERNS KEY REFERENCE
Irrespective of Color (Can be bullish or bearish) |
Uptrend |
Consolidation |
Downtrend |
ANTICIPATED DIRECTION OF TREND
Lighter Arrow = Lower Probability
Solid Arrow = Higher Probability
More Likely to go sideway, Less likely to rally
|
More likely to rally, Less likely to go sideways
|
More likely to go sideway, Less likely to fall
|
More likely to fall, Less likely to go sideways |
