Technical Analysis: Three White Soldiers – Definition, How it Works, Types, Calculation, and Trading

In the fast-paced world of trading, recognising reliable reversal patterns can provide a significant edge. The Three White Soldiers candlestick pattern is one such powerful tool. Formed after a downtrend, this bullish reversal signal consists of three consecutive long green candles, each closing higher than the last.

Traders use this pattern to identify potential trend reversals, confirm buying momentum, and make well-informed entry decisions.

What is the Three White Soldiers candlestick pattern?

The Three White Soldiers is a powerful bullish reversal pattern in technical analysis, commonly used to identify the early stages of an upward trend. It comprises three consecutive long-bodied bullish candles, each one opening within the body of the previous candle and closing above its high.

How is the Three White Soldiers Candlestick Formed?

• Three consecutive green candlesticks with long real bodies.
• Each candle opens within the body of the previous one and closes above its high.
• Shadows are short or non-existent.
• No gaps between candles—ensures price continuity.

This setup signals steady buying pressure and transition from bearish to bullish control.

When is the best time to Trade Using the Three White Soldiers Candlestick?

• After a Downtrend: Appearing at a bottom, this pattern signals reversal and buying control.
• After Consolidation: Indicates a breakout to the upside.
• Ideal Time Frames: Most effective on daily or weekly charts for stronger signals.

What are the Advantages of the Three White Soldiers Candlestick Pattern?

• Strong Reversal Signal: Reflects consistent bullish sentiment.
• High Probability Setup: Often leads to sustained upside moves.
• Confirmation Tool: Strengthens when paired with RSI, MACD, or breakout resistance.

What are the Disadvantages of the Three White Soldiers Candlestick?

• False Signals: Pattern may fail during low-volume periods or market weakness.
• Context Sensitive: Less reliable during extended uptrends or overbought zones.
• Overuse Risk: Traders may over-rely on it without full confirmation.

What does the Green Three White Soldiers Candlestick tell?

The pattern tells traders that:

• Momentum has shifted to buyers.
• Each candle opens within the last and closes higher.
• Signals potential long entry when confirmed by volume or RSI.

How to Trade with Three white soldiers Candlestick in the Stock Market?

1. Confirm the Pattern: Use support/resistance, volume, trendlines, or RSI.
2. Determine Entry: Enter after third candle close or wait for a pullback to support.
3. Manage Risk: Use stop-loss below the second/third candle or nearest support.

Where are the Three White Soldiers commonly used?

• Stocks: Reversal from earnings drops or corrections.
• Forex: Appears in volatile pairs post-consolidation.
• Commodities: Seen at support for assets like gold or oil.
• ETFs/Futures: Used for sector/index exposure setups.
• Options: Helps time bullish strategies like call spreads.

What is the Opposite of Three white soldiers Candlestick?

The opposite is the Three Black Crows pattern:

• Three consecutive long red candles,
• Each opens within the previous and closes lower,
• Signals bearish reversal, especially after an uptrend.

What are other types of Doji Candlestick Patterns besides Three white soldiers?

• Gravestone Doji: Appears at tops, warns of bearish reversal.
• Dragonfly Doji: Seen at bottoms, indicates bullish reversal if confirmed.
• Long-Legged Doji: Signals extreme indecision before a breakout.

Conclusion

The Three White Soldiers pattern offers a strong and reliable signal for bullish reversals. Traders who understand its structure and use supporting indicators can confidently enter long positions with a better probability of success. As part of a broader strategy, this pattern is a cornerstone for spotting trend changes across asset classes. TradeSmart’s tools help identify, confirm, and execute trades based on this time-tested formation.