Three Stars in the South Candlestick: Summary
The three stars in the south name sounds like a constellation visible from Australia only. But it is a candlestick pattern that acts as a bullish reversal and ranks first, yes, first for reversal performance. That means price reverses more often than any other candlestick I studied. Why? Probably because I found only 9 to study. Thus, anything I say on this web page is likely wrong. But here goes anyway…
Three Stars in the South Candlestick: Important Results
| Characteristic | Discussion |
| Number of candle lines | Three. |
| Price trend leading to the pattern | Downward. |
| Configuration | Look for a tall black candle with a long lower shadow to appear in a downward price trend. The second day should be similar to the first day, but smaller and with a higher low. The last day is a black marubozu that squeezes inside the high-low range of the prior day. Good luck finding one. |
Three Stars in the South Candlestick: Discussion
The best average move 10 days after the breakout is a drop of 3.64% in a bull market. That ranks 23rd. I consider moves of 6% or higher to be good ones, so this is almost half of what it should be.
Three Stars in the South Candlestick: Identification Guidelines
Three Stars in the South Candlestick: Example
The breakout from the three stars in the south candlestick is downward when price closes below the bottom of the candlestick pattern. In this example, the candlestick acts as a continuation pattern. Price entered the candle from the top and exits out the bottom, continuing the downward price trend.
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