Understanding Candlestick Patterns 101: Three Line Strike

The three line strike reversal pattern was first introduced by Bulkowski.  It is meant to identify when a current downtrend is about to experience a trend reversal to an uptrend and produces an 84% accuracy rate.

STRATEGY NAME: The Three Line Strike

FOR USE ON: FOREX

TIMEFRAME: Daily Chart

ASSETS: All

RULES:

1. Identify downtrend
2. 3 bearish candles that all open at a lower price than the previous open
3. Bullish candle that opens lower than the previous bearish candle and closes above the high of the first bearish candle
4. Enter a buy/long position
5. Use trailing stop to maximize profit potential