- Three Outside Down
This pattern is reverse, the opposite of the three Outside Up pattern.
In a Three Outside Down pattern the first candle is green. The average candle is red, and its body is larger than the body of the previous one, that is, the second candle absorbs the first one. The third candle is also red, and its closing price is lower than the average. The Three Outside Down pattern is an extended version of the Bearish Engulfing pattern. As a rule, Three Outside Down gives a signal that the trend has made a bearish turn, and the price begins to fall after growth.