This video teaches three-candlestick reversal patterns essential for stock market trading: (1) Morning Star (bullish reversal at chart bottom) and Evening Star (bearish reversal at chart top), both consisting of a strong bearish/red candle, a star candle, and a gap-up/gap-down green/red candle; (2) Abandoned Baby (a more extreme version of Morning/Evening Star with larger gaps); (3) Three White Soldiers (three consecutive green candles indicating bullish continuation) and Three Black Crows (three consecutive red candles indicating bearish continuation); (4) Three-Line Strike (three soldiers/crows followed by a large engulfing candle that can be bullish or bearish depending on chart location); (5) Three Outside Up/Down (confirmation patterns for bullish/bearish engulfing patterns); and (6) Three Inside Up/Down (patterns following Harami formations). Key principles include: bullish patterns appear at chart bottoms while bearish patterns appear at chart tops; volume analysis enhances pattern reliability; and practical application through paper trading is essential for mastery.
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Learn 3 Candlestick Patterns | Free #CandlestickPatterns Course | Episode 3 | Share MarketAdded:
So welcome everyone to the final episode of Candlestick Patterns.
Before this, I hope you must have seen episode one and episode two and we talked in episode one about all the single candlestick patterns, you learned about those candlesticks in the second episode which are made up of two episodes, today you are going to learn about those candlesticks patterns which form from 3 or more than 3 candles, then let me tell you one thing in today's training.
If you haven't seen both the episodes before then it will be a bit confusing because you will understand that you have learned candlestick patterns before it, you will see them in today's video But today what are these patterns telling you, Which side they are giving the indication, the price of the stock will go up or down.
A lot is yet to be learned, so today's video is highly important.
If you haven't seen the first and second episode before it, so I will give you the link on the I button, you can see both the episodes, today we are going to start and this is the final episode as I told you in which you are about to learn all the candlestick patterns that form from 3 or more than three candles.
Then start from here, our first candlestick pattern is the Morning Star and Evening Star.
Now I said that it is formed with three candles.
Earlier you learned what a single candle tells you when we talked about the hammer, dragonfly doji and gravestone.
Here we are talking about the formation of one candlestick pattern by three candles.
Now the pattern on your left-hand side and our right-hand side, whatever will come, will be bullish and which will come on your right-hand side and my left-hand side.
They all will be bearish candlestick patterns.
Now here we look carefully at what these patterns are talking about.
What is it made of and now what you have to see in the morning star, see here, first your candle will be a bearish candle, red bearish candle which will be strong and a long bearish candle After that, you can see below and this is called a star.
This is our star, this is a star, I will just tell you.
After that, the candle you will see will be your green candle.
Now one thing to note here is that the color of a star does not matter.
This star can also be red, alright this can be red also.
So it doesn't matter, here understand what you are seeing here.
The first thing you see here is that a red candle has formed.
This is the price, it originated from here and closed here, which means the sellers were dominated.
After this, you see that there is a gap down opening.
Price was open from here, meaning the sellers were still dominating and here they have done a gap down opening but after that buyers started coming under control.
Price closed here and the price has risen a little bit, it does not matter.
Now let's see the third candle and in the third candle there is a gap up opening, we get to know from here that trend of the market starts changing, then our opening has happened from here and after going here this candle closes.
When the candle closed here then it is showing that earlier sellers were in control, but now buyers are in control, the trend can reverse from here.
Similarly, see the evening Star, that our price opened from here and it closed here.
After that, buyers were still in control, because there was a gap up opening, but after that sellers came in control instead of buyers and they pushed the price down.
After that again we get a gap down opening and price closed here, now you see a condition here.
This is a favorable condition for us and your third candle mustn't break the high of the first candle.
If it does not do it then our morning Star is strong. If It breaks here.
Then you find a very strong green candle here.
You can still consider it Morning Star, but it will become more powerful when this candle will form next time, which means the next candle will open with a gap and it will become a strong bullish candle for us.
Alright, here you understood this, so see on the chart how our Morning star and Evening Star will form.
But before going to the chart, let me show you something.
Now I am giving you this little practical information, You can test it by yourself too.
When you see the forming Morning Star.
Let me take for example that we were just looking at 5-minute candles.
Meaning, whatever candle it is, it is for 5 minutes.
We were watching the chart in five minutes time frames.
Now, this is a five minutes candle and this is also a five minutes candle.
If I merge these three candles, then it will become a 15 minutes candle, right?
Now how this 15 minutes candle forms, I am also telling you how this candle formed.
If you add 3 candles in one minute, alright, then a three minutes candle will be formed.
Alright, now you understand what you are getting here.
Just tell me where the High is, our high of these three candles is there, alright.
So this is our high here, so I am drawing a point here, this is our high, ok.
Now our low after this, here this is our low here, one is high we have and one is low.
And which is our open price, you will say that this is our open price, right we have an open price.
We can see an open price so I put a dot of open price and after that our green candle closed here and it is our close, so I put one more dot here, now I will show you something and, you will remember what we learned in the first episode, It must be revising you now, so here we have a shadow and here we have a shadow and what has become in the middle of it.
Look at this, what do you think, You can see open and close prices.
Open and close price when it opens on top and closes on down and which color candle will form?
Red color candles will be made, and the shape of this candle is visible, absolutely correct, this is our hammer.
You know what you are understanding, it may be a little deep but you know how amazing this information is, understand.
If we were watching the chart at 5 minute time today, then according to the 5-minute chart, we saw a morning star but if we changed the time frame then at the same time we would have seen the hammer.
And you know that hammer is a bullish Candlesticks the pattern then how a single candlestick pattern is being formed, by the multiple candles.
This is also happening from multiple candles.
The time frame of 15 minutes is indicating that now the market will go up and the trend will reverse and it is also telling you for 5 minutes and at 5 minutes you are seeing another pattern and at 15 minutes you are seeing another pattern, isn't it amazing.
Now you see here who, if we talk about the Evening Star, then consider the Evening Star Now watch it, when the evening star is here, now here we have high here, I make a dot here, and we have a low here and I make a low here and after that from where our price opened, our price was opened from here, absolutely correct, I make a dot here and from where our price was closed, our price closed here then I put a dot here, ok.
The dot I made here, I connected them.
This was our shadow and this is our shadow, our price was open from here and our price closed here, so now what is it?
You see this is the shooting star.
So you can see a shooting star here, now there is one more thing if this candle was a little big and if it was still here then what did you get, you got a Gravestone Doji.
You remembered gravestone Doji, and if the open and close price would be the same here then what would you get?
If the open and close price was the same here then you got the dragonfly doji, when you combine the time frames of Candlesticks patterns, then you get the single Candlesticks patterns, which you learned in episode one but they are formed by multiple candlesticks patterns, are you getting it and I hope you liking this and if you are liking it then like this video, maybe you have a question in your mind, I will try it to answer all your questions in this video without you asking, buy If you still have any question, then you can ask in the comment below.
Now let's see how Morning Star and Evening Star appear on the charts.
Let's take a quick look at it, so here we see alright this is a morning star so you see here morning star, I am showing you now morning star and when we will come on next candlesticks then you will see that it is like the morning star.
I will tell you that it will visible like morning stars, but it will be different from morning stars, so they are the same thing to see.
It can be different too, I'll just tell you, so here you can see that under the downtrend you can see on the bottom of the chart, you see all the bullish Candlesticks on the bottom of the chart, so you saw the morning star and after it, you see that price ran upward and you see that an upward movement came here and alright similarly we come and also see the evening star on the top of the chart.
So when you saw it on the top of the chart then you saw an evening Star and here you saw an evening Star and after that, you saw that our price went down.
Alright then you understood this about morning stars and evening stars, now let's talk about this.
Do you think that it is like Morning Star?
See Let me show you the Morning Star again.
You see this morning star.
I told you that this color does not matter.
This is the color of the star.
The star that it is here, its color does not matter that much.
It can also be green.
But this is what your shape and pattern should be like.
Alright so now we are talking about Bullish Abandoned Baby and Bearish Abandoned Baby, Abandoned Baby.
What are these names given by the Japanese people?
You might be thinking about it.
Now abandoned means that which has been rejected.
Meaning one who has been abandoned means a child who has been abandoned, then why is it said so.
I'll just show you why it is said.
If you see it, then you will say that it is a star, now I tell you the difference, the star you saw and there is a small difference in it and the small difference is that you see a little doji-like pattern here.
This can happen in the morning sir and the other thing is that you're low here, your low have not even been touched.
If you will see here that the open price there, it was open with a gap and that too much and the closing here, which your price was opened here and it closed here, after that it opened below, it opened with too much gap, because the gap is too much.
That's why it is called abandoned and it is small because the formation is very small here That's why it's called Abandoned Baby here, are you getting it?
So here it becomes like Doji means color doesn't matter, in most cases, there is always black color in abandoned baby, so you will see Doji of black color and it will not be green and it will not be read, and you can see that color so the color doesn't matter if the gap is more than it will be called abandoned baby and if the gap is less and you see formation here then it will be called morning Star and that is a basic difference.
They both do the same work, this is also a Bullish indicator and here this is our bearish Indicator, again let me show you another amazing thing.
If I could combine the same thing here which I showed you.
I will just show you, if I will show the same thing to you and if I take high here and I get high on this point and if I take low then I get low on this point and after that price was opened from here then I got an open price and where did the price close?
I get a close price here then again it will become a hammer and same we will get a shooting star and if the closing happens here then same I will get dragonfly doji and here I will get gravestone doji, so it is more or less the same and the name of these structure patterns are different so you should know and when you get more gap down opening here then it if it is far away then it is abandoned.
And if it was near, then the morning star and again it is far away, then it is the abandoned baby And if it was near then it would be the Evening Star.
Alright, How to look at the Chart, in this way that you see a red candle and a big candle and after you saw an Abandoned Baby below it and then you see a green candle, which is your bullish candle and then you see a trend Reversal, you saw price going up and similarly if you will see the abandoned baby on the top of the chart then you see something like this on top and after that what you see that gap is too much here and doji is formed here and I told you that doji will become in most of the cases and when doji will become and then your trend will go downward.
Now when you have to make entry, that is very easy, when your bearish abandoned baby becomes after that you will wait for next candle for confirmation which was your low and close here and after that until the close of next candle come here and gap up was opened from here but close was below then you can make entry below and this could be an entry position for you and what will be your stop loss, the top of an abandoned baby that will be your stop loss.
And now I hope you understood the stop loss and entry, next move forward, so let's talk about three white Soldiers.
Now let me remind you.
I told you that in the earlier times, when there was a discovery of candlestick patterns in Japan, then the green candle you are watching and the red candle you are watching, Earlier there was no green and red candle, which is a red candle here, It used to be black here and the green candle was used to be white, so because it was white, then when three consecutive green candles are formed, they are called white soldiers, then the soldiers are going to war to win.
Alright, so suppose they are starting climbing a mountain and after that, you will see a boom then this is a Candlesticks pattern which is telling that Trend can reverse, if you will get three white Soldiers, alright, and the candlesticks pattern I will tell you after it, then you would think that it resembles the Three White Soldiers.
So these are very similar candlestick patterns.
They look alike, but they are also confusing.
I will tell you why they are confusing and you will understand it slowly, so you understand these three white Soldiers what is this?
Let me clear you the concept, this is a concept and understand the concept that price opened from here and closed here but after that again sellers became dominating and they brought down the price, the price was closed here but after that, it came down again and opened again Then it closed and after that when it closed again then price came down again, Then it opened then closed, so now when it happens three times in a row and happens in three different candles, then we call it three White Soldiers, if such the same thing happens three times in the bearish candle, when will the pattern be formed inside, at the bottom of the chart after that trend will reverse and here the pattern that will be formed.
It will form at the top of the chart and then it will indicate trend reversal.
Now here you see from where the price opened, the price was open from here and then it closed, but after that seller brought it down, but price opened again up and it closed down then the price goes up again and it opened and then it went down and closed and when this happens continuously, it looks to see that candles have been formed.
But when they are being made in front of the eyes, then the psychology of the people changes.
If the price goes down then it goes up again then people do not have that much patience and it is necessary to have that patience.
I have told you many times that there is a difference between training and trading, then you will be trained when you will practice and you are not going to earn just by watching this video, then you have to practice.
For that, you must have a Demat account.
If you do not have your Demat account yet, then there is a link of leading brokers in the description and comment box of this video then you open your Demat account today when you will have a Demat account and invest time in it.
The market is open from 9:15 to 3:30 on the working days, so you have to give your time and attention there.
You start with paper trade and you start from small capital but until you do not start learning and you will not practice then you Will Not Learn anything then these all training are waste for you and if you are there then I know you are serious, alright now here you have understood one thing.
Now let's see here how it looks on the chart.
Here you see the chart, alright what do you see in the chart.
You can see that the three White Soldiers have become for you.
And These are the three White Soldiers, It doesn't matter in it that your candles will be of same size They can be big or small, it does not matter but all three of them should be made of green color here It is not that the middle candle has become red we want all the three green candles alright.
After that, we will also wait for confirmation.
Will wait for the confirmation that which is the high of the last candle until the next candle closes by going up in it because next becomes doji and if it is coming after that then we will wait and we will take entry here.
And the stop loss we will place, it was the low of the candle and this low here will act as a stop loss for you.
And your entry is you already know now that when you will get the confirmation and after the high last candle, after going to the candle this high will be close, then after that you can make entry, so you know the entry and stop-loss now, in the same way, we see that our three black crows, how three black crows will help us, so not only in India maybe crow are not considered good in Japan as well that three black crows are sitting, it means that anything good will not happen, then the price will go down then you see here that you are watching three Black crows and then what happened that you wait for confirmation, you wait for confirmation that our last candle where it closed, At least the next candle should go below it then this candle did not go under the one which has turned green.
After that which is the next candle, you see that the price is going down there.
With this candle, you can take an entry and you will put stop loss at the top of the first candle Great, now we move forward, now I hope this won't be boring for you, so you are learning new things.
So now let's understand that what is bullish three lines strike and what is bearish three lines strike and before it, I told you that you will find things like, can you see these three white Soldiers and you will say yes, they are three white Soldiers you told us now, can you see these three black crows, you will say yes, absolutely visible.
Now, What people do here is that when you search the internet about candlesticks.
You will find many videos in which, There will be the talk of one or two different candlestick patterns.
But you need to give time to it, you need to be understood.
Here too which is this three bullish three line strikes, this is the bullish pattern, this is the bullish Candlesticks patterns and this is bearish Candlesticks Pattern, but sometimes people gets confused because you have incomplete information, then you can be confused, so now you look here that you can see three white soldiers here.
After that, you see a very big candle which is working in a way that if you have learned about this engulfing pattern that if I don't see it before, it is visible like a bearish engulfing pattern, but this is a trap for you and if you see the pattern become like this and if you think that this is the bearish engulfing pattern and you have not paid attention towards it before it then you will make your loss because of this Bearish engulfing pattern.
What loss you will make, you will think after this that price will break from here and the trend will go down from here and then you will make a loss because it was a trap, it is a bullish pattern and how this is Bullish pattern now let me tell you how this works.
Here you can see three white Soldiers and you can see here a bearish candle if you see this pattern forming at the bottom of the chart.
If you see it becoming on the bottom then it is bullish, now one more thing I tell you is that if this pattern is made on the top of the chart then this will not be bullish and then it will become Bearish, see how confusing things can get.
If you don't know about them and if you will leave these fundamentals, I told you that all the bullish Indicators will be made on the bottom of the chart and this bullish indicator made on the top of the chart then this will work in reverse, then it will be bearish.
Then that engulfing thing will be completely fine and look at this pattern here, here you can see three black crows but the three black crows you can see, after that a big pattern which is a bullish engulfing pattern, if we see these two Candlesticks.
Now we are looking at these four, I said that I will tell you about three or more than three, then it is bullish here but it is bearish too.
Now when it will be bearish, if it made on the top of the chart then it is Bearish, now if this pattern will become on the bottom of the chart then it will work bullish.
Now you might be getting confused.
Now I'll show you, you understood that this pattern is Bullish and you understood that this pattern is bearish, but if it will become on the bottom of the chart, let me show you.
So I will just show you, I have taken an example of this for you, see where this is becoming on the bottom of the chart and which is this, three you saw three black crows and then you saw something like a bullish engulfing pattern, just see this.
Have you seen that you saw three black crows and it was Bearish but despite this price going up, why because if it will become on the bottom then it will work in reverse?
Similarly, I will give you one more example.
Here you see the three white soldiers but they are becoming on the top of the chart and after then you see an engulfing pattern, and after then you see a bearish engulfing pattern which is right, this is not your bearish engulfing pattern, this is your three-line strike and three-line strike is bearish strike, this is called a strike because it crossed first three, we call it to strike that all the earlier three White Soldiers were killed, they were struck by bearish candle or sellers and after that, you see that price went down, You guys are having fun.
Now if you are enjoying this video, then share it because the time being taken to give you this information is being spent so that the right information reaches more and more people, alright then let's understand the next and the second last candlestick pattern of the day, nowhere you see this is the three outside up and now these three outside up and three outside down, maybe you are finding these names confusing.
The thing is that if you learn these candlestick patterns in a single time then you will get confused, that's why I made three episodes.
At first, I have told only single candlestick patterns that you should remember it.
If you practice them, you will be remembered.
After that, the other candlestick patterns are formed and today we are talking in this episode about those Candlesticks Patterns which are made with three and more than three Candlesticks and I said, this is the second last.
But now you wait for one minute.
There are more candlestick patterns.
We've covered those candlestick patterns that are significant which you will see forming many times on the chart, But you have to learn more.
Now the thing is that it has taken time to make three episodes and you have also taken a lot of time to learn and you are learning very good, but there are also candlesticks pattern apart this and if you want that we will also cover them, then you didn't have to do only one work, you have to do two works, first, you have to do your self-research on the internet, you have to also self-study study because you are not getting confused and you want to learn then do some self-study.
You will tell me in the comments which candlestick patterns I haven't covered yet and when your names will appear in the comments and I will see the demand for candlestick patterns I haven't covered it yet.
Then we will make the next videos on the Candlestick patterns, so again the videos we are making are on demand The demand of the public is coming, that's why we are making videos and if your demand will come then we will also make a video, now you see here three outside up, what is this.
First, you understand the movement of the buyers and sellers.
What are they showing here, understand this candlestick pattern here that if you do not see all of three if you did not see all of three if you are watching only two Candlesticks then here a Bullish engulfing pattern is visible to you, here you have to remember this that this is three outside up and we are going to talk about three inside up, let me tell you the difference, here it is a bullish engulfing pattern, if you are watching two candles, you are getting its confirmation from the third candle, The price which is here, it opened from here and sellers took it down and it got closed here.
What happens after that is that again the price goes down.
The opening here, goes down a little more, it is a gap down opening and after it, buyers become dominating here and Price closed here, but then what you see, price again goes a little it opened here and it closed here and it is indicating towards trend reversal, now What's the point here now that your first candle will become red and second candle will become green and the third will also become green and with it, you have to see volume also, Volume works in all candlestick patterns and you also need to see that the second candle has more volume than the first candle and the third have hundred percent more.
A middle candle does not matter as much, as the third candle matters, that in comparison to first and third, third should have more volume, so bullish engulfing was visible here and the third candle gave you a confirmation and you can make entry above it and here you can place your trade by putting a stop loss on low on below of this middle candle and if still, you want to take confirmation then you can wait till the next candle and it's high and after that the next candle when it closes by breaking it's high.
And after that, you can make an entry so you can wait for dual confirmation and this pattern is also giving you a confirmation that you can take the entry after it's high and you can put stop loss at its low, great.
Similarly, see here, you see here bearish engulfing pattern, but what is happening after it, understand it opens here and closes hereafter that when it opened, it opened above which was positive, a trend was going on and it was fine, but Sellers got so dominant that they bring down the price and our closing happened below and after it, this is a bearish engulfing pattern, now what happens after it that price goes up again and buyers works but sellers again dominate and the price comes down, now this pattern is called three outside down, this is three outside up and this is three outside down, now how it looks on a chart, let's see quickly.
So wee see here, you can see here that it is working like a bullish engulfing pattern for you and you have to check two or three things that all the Bullish pattern will become on the bottom of the chart and they became on the bottom of the chart and after it, you can take entry on this third candle and you can wait, when it will close on its high, you can make entry from here and you can put stop loss here, next we see how three outside down work's, so you will see three outside down on the top of the chart.
You can see that it is working work of Bearish engulfing candle and after that, you see one more candle, which you see downward and if you want then you can take the entry form here and if you want then you can wait for confirmation that after this low when you saw that close came so you can take the entry from here also and you will see the price going down.
So i Hope that you must have enjoyed it and after that our final candlestick pattern remaining, we cover it also and that is three inside up now what you have to take care of three inside up, you saw there Bullish engulfing, you remember here we talked about Bullish harami, it was like a pregnant mother the bullish harami, so she was mother and he was child if you remember, he is baby and she is mother, now it is a Bullish pattern for us again, price opened from here and it closed here but then what happened that price opened here and closed here, here buyers took the movement above but then price come down again and opened here and then buyer showed its full force and closed here and we call this pattern three inside up, alright you can make entry from here if you want from the top of third candle because it is giving confirmation itself and you are getting confirmation from it after bullish harami and this pattern will called three inside up, it is called three Inside up, three Candles are giving you confirmation and you can trade and similarly here you see that you was watching in uptrend, a green big candle formed and after a baby candle formed, the baby candle formed, it is coming in our full body, so it is a bearish harami pattern but after that what you see that price opened here although after opening from here seller's brought down the price but then the price shoot up again but the sellers brought down the price and it closed so you can take entry from low and you can put the stop loss from the High of first candle and here if you want to see then i show you on the chart that how it looks so you always see bullish patterns Below the chart and Bottom on the chart, so you can see this the big candle and this is the small candle and this is the mother candle and this is the Baby candle and after that you can see the green colour candle up for the confirmation so this is three inside up and after forming pattern like this, price goes up and finally we also show you three inside down.
Your three inside down, it will visible to you after an uptrend and you see on an uptrend at the top of the chart and then what you see that a green candle was formed and a baby candle was formed and the last candle which was made of your red color is giving confirmation for the price that the price is going down and it is indicating towards the trend.
And the price goes down so I hope that today you must have understood a lot.
And finally, we have to talk about some things with you, then we do that.
See, today I will tell you one thing.
These three episodes are getting completed here and also not completing here they are completing because what I had to teach you, I have taught you all the significant candlestick patterns, we have tried our best to cover all the candlestick patterns but the Candlesticks patterns we have not covered, Well they are more significant.
Despite that, which remained. I want you to self-study a little.
You do self-study and if you still want us to cover them, then you will comment, we will make the videos but I have left them Intentionally because it is taking so much time and if you have given time till here that means you are damn serious and if someone has not even learned it, it means that he is not a that serious person and if you have remained till here then you are serious so if you are serious then just do practice and if you will practice.
See practice makes men perfect but I say it makes everyone perfect, I say that it is not about only men and women, but practice makes everybody perfect.
So do paper trade and do practice, see you trade in stocks and you trade in commodity and you trade in Crypto and Forex and I want that you get maximum profit and minimum loss.
So you do whatever you can do to improve your trading and share this video.
Finally, upcoming videos will be more powerful.
This is what I promised.
To subscribe to this channel now and click on the bell icon if you are watching this video on Facebook then you can follow up if you have not opened your Demat account yet then I will give a link in the description and comment box of this video of leading brokers, you can open your Demat account and if you still have questions then you can ask in the comments below.
So you can like this video and you can share this video and I will see you in the next video till the time go self-made
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