Three Black Crows

The Pattern

Three Black Crows forms over three consecutive bars:

1. Three black (close-below-open) bodies in a row.
2. Each bar opens inside the prior bar’s body (not gapping below).
3. Each bar closes near its own low, with short lower wicks.

The pattern must print after an uptrend. The three bars together cover a substantial price range downward, with the closes stair-stepping lower.

The Story Behind It

Where single-bar and two-bar reversals can be dismissed as noise, Three Black Crows is harder to ignore: three consecutive sessions of disciplined distribution, each session’s sellers building on the previous, none gapping away from the action. Classical analysts read it as a regime change visible in the tape itself rather than inferred from a single dramatic bar.

The mirror cousin to Three White Soldiers and structurally identical in reverse. Like its bullish counterpart, the pattern has a degenerate cousin called Advance Block where the bars are still all black but progressively smaller, indicating selling that is losing steam. The strict Three Black Crows definition filters those out.

When It Tends To Work

• After a sustained uptrend, where three consecutive down-bars represent a meaningful break from the prior pattern.
• In single-stock or single-commodity contracts that lack the structural long bias of equity indices.
• When the third bar still closes near its low. Late-day strength on the third bar weakens the signal.

When It Tends To Fail

• In equity index bull regimes where the dip-buy reflex kicks in before the hold window completes.
• After news-driven crashes that exhaust quickly. Three consecutive panic-sell bars after a sharp rally often see a violent snap-back within days.
• In low-frequency contracts where the pattern may fire only a handful of times per year.

How This Strategy Trades It

Enter short at the close of the third bar. Hold for hold_bars sessions (default 5), then flatten unconditionally.

Related Patterns

• Three White Soldiers: the directional mirror.
• Evening Star: a different three-bar bearish reversal, up-pause-down sequence instead of three consecutive down-bars.
• Bearish Engulfing: a two-bar version of the control-shift idea.

Try It Yourself

The default preset uses 1-contract sizing on NQ daily bars. The form lets you change the contract, timeframe, hold length, and contract count.