What is the Three Black Crows Pattern?
Quick Answer: Three Black Crows is a bearish candlestick pattern of three consecutive long-bodied red candles closing lower, signaling potential trend reversal.
Understanding the Three Black Crows Pattern
Three Black Crows is a bearish candlestick formation consisting of three consecutive wide-bodied red candles that close progressively lower, often after an uptrend. It signals aggressive selling and potential reversal.
Confirmation Factors
Look for the pattern near resistance or within a supply zone. Volume expansion and momentum indicators like RSI rolling over add credibility.
Entry Timing
Some traders wait for a brief retracement after the third candle to secure favorable risk/reward, placing stops above the pattern high.
Limitations
In strong trends, Three Black Crows can be a pullback rather than reversal. Combine pattern analysis with higher-time-frame bias and macro context to avoid premature shorts.
False Signals in Ranges
Within choppy ranges, bearish clusters may fail quickly. Confirm momentum breakouts or confluence with other signals before acting.
Related Terms
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