Definition

The Three Black Crows is a robust bearish reversal candlestick pattern that appears after an uptrend or at a peak. It consists of three consecutive long red (bearish) candles, each closing lower than the previous one and near its session low. The pattern signals a decisive shift from buyers to sellers, often marking the start of a prolonged downtrend.

How to Identify

Key identification criteria:

Three consecutive long red candles with progressively lower closes.

Each candle opens within the body of the previous candle but closes significantly lower.

Minimal or no shadows (wicks), indicating overwhelming selling pressure.

Increasing volume across the sessions confirms bearish strength.

In SMC, the pattern often emerges after a Break of Structure (BOS) and below a supply zone.

How to Trade

Entry

Sell immediately after the third candle closes, with a stop-loss above the high of the second or third candle.

Alternatively, wait for additional confirmation like a BOS or a pullback to a newly formed supply zone.

Profit Targets

Measure the distance from the pattern's start to the nearest swing low, or aim for a Risk:Reward ratio of at least 1:2.

Hold until a bullish reversal signal appears (e.g., Three White Soldiers) or price reaches a strong demand zone.

Real Examples

On the EUR/USD D1 chart, after a sustained uptrend, three consecutive long red candles formed at the 1.2000 resistance zone. Volume surged, and shadows were minimal. Price then broke market structure (BOS), confirming the pattern. A trader entered short on the third candle's close and took profit at the 1.1800 demand zone, achieving a 1:3 R:R.

Common Mistakes

Confusing it with the Three Inside Down or other three-candle bearish patterns that lack consecutive long bodies and lower closes.

Trading without volume confirmation: low volume Three Black Crows may be weak signals.

Entering prematurely before the third candle completes, leading to false signals.

Ignoring market context: at the bottom of a downtrend, the pattern might indicate continuation, not reversal.

Content is for reference only, not investment advice. Forex trading carries high risk.

Three Black Crows - Strong Bearish Continuation Signal