Definition
Bearish Side By Side White Lines consists of three candles. The black candle, formed in the inclining trend, is followed by two white candles. The white candles are a gap below the black candle. It happens because short position owners cover their positions, real trend reversal is not expected. The inclining trend must continue.
- Trend: Continuation
- Expected trend: Bearish
- Previous trend: Bearish
- Reliability: Low
- Type: Bearish
- Number: 3
Recognition
- The market is in a downward trend.
- The first day is a black candle.
- The second day is a white candle, leaving a gap behind.
- The third day is also a white candle with similar body and closing price as the previous candle’s.
Interpretation
In the inclining trend, two consecutive white candles appear after a black candle. The white candles’ trading range is below the previous trend. There is a gap between the first day and the last two days. The formation may warn short position owners to close their positions, but there is a high chance that the trend will continue.
Important factors
Bearish Side By Side White Lines is a very rare formation. The length of the white candles is not necessarily the same, but the opening prices must be close to each other. To make sure the trend is reversed, a confirmation on the fourth day is needed. The confirmation could come from a black candle with a downward gap or a lower closing price.
