The Three Candles strategy is an example of a simple trading system that is highly effective at the same time. This strategy is based on patterns: it looks for when certain fluctuations appear together on a chart, since this provides a basis for making an effective prediction about how the price will change.
Why should you use this strategy?
The pattern that we will look at in this article is called the Three Candles. Similar patterns that are also well known include the “Three Black Crows” and “Three White Soldiers.” The strategy is simple for novices to learn, and experienced traders eagerly use the signals provided by this system and combine them with other trading strategies in their toolkit.
How can I trade using the Three Candles strategy?
In order to determine the first candle in the pattern, you need to pay close attention to your candlestick chart. The first candle that we are looking for has a higher High or a lower Low cap than its neighboring figures.
The next candle is the second bar in the pattern, and how it closes confirms the existence of a pattern. Finally, the third candle is the final one in the series, and it is the one that will make us money.
In order to trade on this strategy, you need to enter the market just as the third candle is starting to take shape immediately after the close of the second candle. You should avoid entering the market if the first two candles are small or if the second candle is too large.
- Expiration: 1 candle
- Investment: 2% of deposit amount