Pattern Detail

Bearish Ladder Top

Five-candle bearish reversal: three rising up candles, a fourth up candle with a long lower wick, then a long down candle that opens below it.

This pattern did not fire often enough on this market and timeframe to measure. Try a lower timeframe or a more active instrument.

A ladder top is an uptrend climbing one last rung before it breaks. Three up candles step higher in a row, a steady ladder. The fourth candle is up too but leaves a long lower wick, the first sign of selling pressure poking through. Then a long down candle opens below that fourth body and falls hard. The ladder gives way and the move rolls over.

How to spot it

  • The market is rising into the pattern.
  • The first three candles are long up (green) candles, each closing higher than the last.
  • The fourth candle is up too and closes higher still, but it leaves a long lower wick.
  • The fifth candle is a long down (red) candle that opens below the fourth candle’s body.
  • That gap down off the top, after a clean climb, is the break.

The psychology

The first three candles are a clean ladder higher, each one closing above the last. This is a confident uptrend with buyers firmly in charge, climbing in orderly steps. Nothing here suggests trouble, which is exactly why it lulls people into trusting the move.

The fourth candle still closes higher, so on the tape the rally looks intact, but it leaves a long lower wick behind it. That tail is the first sign of selling poking through: sometime in the session price was driven well below the close before buyers rescued it. Then the fifth bar opens below that fourth body and falls hard. The gap down off the top is the rung breaking. Buyers who were comfortable a session ago are now trapped above the market, and the side that had been absent through the whole climb takes control in one decisive move.

The break shows in that long down candle. Whether a ladder that snaps like this tends to keep falling is what the figures below work out.

Does it actually work?

A pattern is a setup, not a trade, so the honest question is not “did it win” but “how much room did it tend to offer before it was proven wrong.” The tabs below answer that across five futures markets (Nasdaq, S&P 500, gold, crude oil, natural gas) and seven timeframes from one minute to one day.

For each occurrence we measure the room the move offered in units of the pattern’s own risk, then set it against what a random entry on the same market would have done. When the pattern offers more room more often than chance, that shows up as a real edge. When it does not, the page says so plainly.

Read it with the sample size in view. On the faster timeframes a pattern can fire thousands of times, enough to trust. On the daily chart it is far rarer, so treat those numbers as a hint rather than a verdict. Thin samples are flagged for you on the page.

How we measured it

  • Entry is the close of the final candle of the pattern.
  • One unit of risk, 1R, is the distance from that close up to the pattern’s invalidation point: the highest high of the 5 candles that form it. If price trades through there, the setup is wrong.
  • We then follow the next 20 bars and record how far price ran in your favor, in multiples of that risk, before the stop was hit.
  • Every figure is set against a random entry on the same market and timeframe, so the market’s own drift is accounted for.
  • No profit target and no position sizing. Where you take profit is a strategy choice; this measures only the room the pattern tends to give.

What this page does not cover

  • Volume on the pattern’s candles.
  • Whether the pattern forms at a meaningful resistance level.
  • Pairing it with a trend filter or a confirming signal.
  • A profit target or position sizing. We use the pattern’s own invalidation point as the stop to define risk, but where you take profit, and how much you put on, are strategy decisions this page leaves to you.

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