The Rising & Falling Three Methods: How to Identify and Trade

If you're a trader looking to take advantage of upward trends, the Rising Three Methods candlestick pattern could be just what you need. This pattern can give you a second chance to enter the market and make profits. In this post, we'll explain what the Rising Three Methods pattern is and how to identify it.

What is the Rising Three Methods pattern?

The Rising Three Methods pattern is a bullish candlestick pattern that consists of five candlesticks. The first candlestick is a large bullish candlestick with a small shadow. The second, third, and fourth candlesticks are bearish candles, but they can't go lower than the bottom of the first candlestick. The fifth candlestick is a strong bullish candlestick that should close above the top of the first candlestick.

How to identify the Rising Three Methods pattern?

When you see the Rising Three Methods pattern in the middle of a clear uptrend, you're going to want to look for the following characteristics:

  • A large bullish candlestick with a small shadow
  • Three bearish candles that can't go lower than the bottom of the first candle
  • A strong bullish candlestick that closes above the top of the first candle

How to trade the Rising Three Methods pattern?

Once you identify the Rising Three Methods pattern, you can enter the market with a long position. However, it's important to wait until the price shoots up above the final candle's high before entering the market. You should also place your stop loss at the swing low of the fifth candlestick.

As for your take profit, you can hold onto the trade until a major resistance level pops up.

Conclusion

The Rising Three Methods pattern can be a powerful tool for traders looking to take advantage of upward trends. By identifying this pattern and trading it correctly, you can increase your chances of making a profit in the market. Remember, the Falling Three Methods is the same exact pattern but in reverse, so keep an eye out for that as well.

Watch this video to better understand the concept:

Back to blog

Recommended Exchange

Founded in 2018, BingX is a leading crypto exchange that offers spot, derivatives, copy, and grid trading services to over 100 countries and regions worldwide with over 5 million users.

Sign up