How to identify a trend reversal?
Three Black Crows is a powerful candlestick pattern that warns traders of a possible reversal in an uptrend in financial markets.
Candle Formation: This pattern consists of three consecutive bearish candles, each closing lower than the previous one.
Absence or Short Lower Shadow: Each of the three candles has a negligible or absent lower shadow, indicating strong bearish dominance in the market.
Opening and Closing: Each subsequent bearish candle opens higher than the previous one and closes nearer to its low, confirming the downtrend.
Encountering Three Black Crows after a prolonged uptrend signals a possible start of a bearish trend. This could be a signal for "Down" trading or for closing long positions.
Remember, to increase the likelihood of successful trading, always use additional indicators and confirmations.
Wishing you successful trades!
