What is Upside Gap Three Methods Pattern?

It's a bullish continuation pattern that appears during an uptrend. It shows a strong price surge, a brief consolidation, then another surge.

How to Identify

First candle: a long bullish candle with an upside gap from the previous candle.

Then a group of small candles (2-3) that move sideways or slightly down, but remain above the gap without filling it.

Final candle: a long bullish candle closing above the small candles, confirming continuation.

Enter BUY when the final candle closes above the small candles' high.

Place stop loss below the small candles' low or below the first candle's low (gap).

Profit target: at least the height of the first candle.

Assume EUR/USD in uptrend, first candle gaps up to 1.1000. Then three small candles range 1.1020-1.1050. Fifth candle surges to 1.1100. Buy signal.

Confusing with reversal pattern: ensure gap remains unfilled.

Entering too early without final candle confirmation.

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