What it looks like
Bullish: in a rise, three up candles each closing higher, then one long down candle that opens near the third candle's close and closes below the first candle's open. Bearish: in a fall, three down candles each closing lower, then one long up candle that closes above the first candle's open.
What it means
The fourth candle looks like a reversal, but often it is just traders taking profit after three strong candles. The trend paused sharply and the side in charge came straight back. It says the trend is still in charge and the pause was only a rest.
Bullish and bearish versions
How to trade it
- 1
Check the trend: trade the bullish version only in a rise and the bearish one only in a fall. In a sideways market it means nothing.
- 2
Bullish: buy when price closes above the pattern's high. Bearish: sell when price closes below the pattern's low.
- 3
Put the stop just below the pattern's low (bullish) or just above its high (bearish).
- 4
Target one to two times the stop distance, or the next ceiling or floor.
- 5
Example: on the gold 15 minute chart in a rise, a bullish three line strike spans 16 points. Price closes above its high, you buy with a stop about 17 points away and aim for 17 to 34 points.
Bullish: a close below the pattern's low. Bearish: a close above the pattern's high.
Where it works best
Inside a clear trend on 15 minute charts and higher, where the strike candle is a pause rather than a turn at a major level.
WickSpeak finds the three line strike automatically on any chart and names it on the candles that made it. It writes what it is, how to trade it and what proves it wrong right on the chart. Playbook can use it, or any of the 146 patterns, as a condition alongside up to 12 conditions on any of 12 timeframes, and backtest the play on past candles with your costs.
Common mistakes
- Trading the strike candle as a reversal, against the trend.
- Using it in a sideways market, where it means nothing.
- Entering before price has closed beyond the pattern's high or low.
Related patterns
Questions traders ask
Is the three line strike a reversal or continuation pattern?
Some books call it a reversal, but WickSpeak treats it as a continuation. The app's own text notes that in testing the trend usually resumes after the strike candle.
What is a bullish three line strike?
Three up candles in a rise, then one down candle that wipes out all three. Buy only if price then closes above the pattern's high.
Where does the stop go on a three line strike?
Just beyond the far end of the pattern: below the low for the bullish version, above the high for the bearish one.
What cancels a three line strike?
A close beyond the other end of the pattern. For the bullish version that is a close below its low, for the bearish one a close above its high.