Three white soldiers have proved to be a reliable reversal pattern when applied by other technical indicators like the relative strength index. The candle size and length of the shadow are taken into consideration to determine if there is a risk of retracement. Three white soldiers being a bullish visual pattern are used as an entry and exit point by traders. 

 In This Article – 

What are Three White Soldiers?

How to analyze the chart using Three White Soldiers?

Category – Trend

Type – Lagging

What are Three White Soldiers? 

The three white soldiers pattern is a bullish candlestick pattern which is formed on the trading chart at the bottom of the downtrend. The pattern is made up of three candles that are green in color. This candlestick pattern signals an upcoming trend due to the strong buying pressure. These candlesticks do not have long shadows and open with the real body of the previous candle in the pattern. 

Image Source:- https://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/content-2-chart-images/three-white-soldiers.png

If you find three consecutive green or white candlesticks then it’s a sign of three white soldiers pattern. Each of the candlesticks opens and closes progressively higher than the first one. The candlesticks should have big bodies and very small or no wicks. 

How to analyze the chart using Three White Soldiers? 

Let’s understand the Three white soldiers indicator with a chart example. 

We are referring here to the GBP/USD price which opens the trading day at $1.23723. After the entry of buyers and sellers, the price starts showing movement. It goes at a low of $1.23657 but the buyers are putting a lot of pressure on the market. So the GBP/USD price hits a high of $1.24293 and finally gets closed at $1.24211. 

The bulls keep on pushing the price up on the next trading day and it reaches the high of $1.24958 before closing at $1.24873. This trend is found even on the third day when buyers can push the price of GBP/USD up to $1.25494 and finally gets close to $1.25388.These upward moves over the trading period create three white soldiers candlestick patterns as shown in the below chart:- 

Image Source:- https://a.c-dn.net/c/content/dam/publicsites/igcom/uk/images/content-2-chart-images/three-white-soldiers-chart.png

Some traders when they notice an upward trajectory occurring due to the three white soldiers pattern, they prefer to open a long position to gain profit.