Market School: Japanese Candlesticks – Bullish Rising Three Methods
The Rising Three Method is a bullish continuation pattern (The opposite of the bullish Rising Three Methods pattern is the bearish Falling Three Methods). The first day’s green candlestick is followed by a group of small candlesticks, which hold within the long green candlesticks range. The small candlesticks can be any color but red is most common. The final day is a strong green candlestick with a close above the first day’s close. The formation represents a rest before resuming the bullish trend, which is similar to Flag or Pennant formations.
Intensifying factors:
- The ideal number of small candlesticks is three.
- If on the final day there is heavy volume.
[Real-Time Stock Chart via Daily Stocks for iPad]
The Bullish Rising Three Method pattern is included in our Daily Stocks iPad and Japanese Candlestick iPhone apps.
For a full list of Japanese Candlestick Patterns tracked by these apps visit our Japanese Candlesticks Page.
The Bullish Harami pattern (the reverse of the Engulfing Pattern) is a small green candlestick, which is contained with a prior relatively long red candlestick. The formation is comparable to Inside Day pattern (
The Bullish Engulfing Pattern is a reversal pattern characterized by a large green candlestick engulfing a red small candlestick, which appears after a downtrend.
Three White Soldiers is a group of three green candlesticks with consecutively higher closes (The opposite of the bullish Three White Soldiers pattern is the bearish Three Black Crows). If the pattern appears after low prices, then it is a sign of a strong reversal.
The bullish Morning Star is a three candlestick bottom reversal formation (The opposite of the bullish Morning Star pattern is the bearish Evening Star pattern). It is comprised of a long red body followed by a small body, gapping lower to form a star. The third day is a green body that closes well into the first day’s red body. The third candlestick signals that bulls have seized control.
Bullish Three Outside Up is a three candlestick bottom reversal formation (The opposite of the bullish Three Outside Up pattern is the bearish Three Outside Down). It is another name for the Confirmed Bullish Engulfing Pattern (the third day is the confirmation).
Bullish Three Inside Up is a three candlestick bottom reversal formation(The opposite of the bullish Three Inside Up pattern is the bearish Three Inside Down). It is another name for the Confirmed Bullish Harami Pattern (the third day is the confirmation).
Bullish Piercing Line is a bottom reversal pattern (The opposite of the bullish Piercing Line pattern is the bearish Dark Cloud Cover Pattern). The formation appears during a downtrend. The first candle is a bearish long body. The next day market opens with a gap at a new low. Then the stock surges toward the close, managing to reach the midpoint of the prior day’s body. The bears will be second guessing their position.
