8.62 Strategy 62: Three White Soldiers & Black Crows

Most breakout strategies require you to wait for a 'retest' of a broken level before entering. However, sometimes institutional momentum is so unbelievably strong that the market simply never pulls back. If you wait for a retest, you miss the trade entirely. The Three White Soldiers (Bullish) and Three Black Crows (Bearish) patterns are designed to get you into a runaway freight train.

The pattern consists of three consecutive, long-bodied candlesticks moving in the same direction, each opening within the previous candle's body and closing beyond the previous candle's high/low. Crucially, these candles must have very small or non-existent wicks. The lack of wicks proves there is zero opposition from the other side of the market.

1. The Context: This pattern is useless in a sideways, choppy market. It MUST occur as a breakout from a major consolidation zone or a bounce off a major Daily support/resistance level.
2. The Trigger: Wait for the 3rd candle to fully close. Never enter while it is still forming.
3. Entry: Enter a market order (Buy for Soldiers, Sell for Crows) the moment the 3rd candle closes.
4. Stop Loss: Place your stop loss below the low of the 1st candle in the sequence. If the price manages to retrace all three massive candles, the breakout was a fake.
5. Take Profit: Use a 1:1.5 Risk-to-Reward ratio, or trail your stop loss behind the moving 20 EMA to ride the runaway trend.