WEBVTT 00:03.260 --> 00:08.220 In this video I want to take a look at three white soldiers and three Black Crowes. 00:08.240 --> 00:10.150 Now as I'm sure you can imagine. 00:10.220 --> 00:13.050 Here's three candlesticks in this patter. 00:13.070 --> 00:17.750 I would also point out that the white soldiers are really green soldiers these days. 00:17.750 --> 00:21.500 This harkens back to the black and white candlesticks. 00:22.160 --> 00:24.490 So think green soldiers. 00:24.500 --> 00:25.740 Red crows. 00:26.120 --> 00:29.480 But you get the idea it's all the same thing really. 00:29.480 --> 00:36.380 So at this point I'm drawing these patterns out and something that I would bring to your attention is 00:36.380 --> 00:39.800 the psychology these patterns because it takes so much to make them occur. 00:41.120 --> 00:42.850 This is typically found on the daily chart. 00:42.860 --> 00:49.610 That's pretty much where people used to refer to these patterns and what happens is you get a bullish 00:49.610 --> 00:55.200 day and then the second day gap lower but the buyers come in and overwhelm the sellers. 00:55.400 --> 01:00.640 And then on the third day we get another gap lower and the buyers come in and overwhelm the sellers 01:00.650 --> 01:06.140 we'll think about how much momentum building and how much wherewithal that takes by the buying public 01:06.800 --> 01:09.160 to push the market higher. 01:09.260 --> 01:11.030 Three black crowes same exact thing. 01:11.030 --> 01:12.150 We break down. 01:12.200 --> 01:15.160 We get a gap higher but the sellers come in and overwhelm. 01:15.440 --> 01:16.960 And then on the third day we go up higher. 01:16.970 --> 01:19.250 But the sellers come in and take over again. 01:19.370 --> 01:24.980 Trading These are simple you put your stop loss on the other side of the three candlesticks or if you're 01:24.980 --> 01:30.430 a little bit more conservative you can make it the second candlestick comes down to you really know 01:30.460 --> 01:37.420 what your risk profile is and you're aiming to follow the trend you're aiming to find in this case resistance 01:38.670 --> 01:43.070 or if you're three black crows you're looking for support. 01:43.230 --> 01:49.980 If you don't have that you know the reason I don't say 1 to 1 or 2 to 1 is that you're looking for a 01:49.980 --> 01:57.430 bigger move at this point with a little bit of luck so if you don't have supporter or resistance then 01:57.430 --> 02:02.290 you start looking for candlestick patterns that suggests a reversal like a shooting star or something 02:02.290 --> 02:04.150 like that down the road. 02:04.150 --> 02:12.930 So as always let's take a look at an example you can see rally gap lower rally gap lower rally again. 02:12.940 --> 02:16.950 So on a break of this candlestick pattern sample ask. 02:16.990 --> 02:22.660 In this case could have gone into either one and you can see clearly that we've rallied Where did we 02:22.660 --> 02:25.770 run into our first bits of trouble here at these shooting stars. 02:25.780 --> 02:28.020 So it does work out. 02:29.450 --> 02:38.220 And that's an example why I say use your candlestick pattern because since there was no real clear defined 02:38.330 --> 02:42.020 level and just above you want to at least give it the chance to take off. 02:42.710 --> 02:54.240 So in this situation on Zillow we have negative candle gap higher break down much lower negative candle 02:54.360 --> 02:56.130 gap higher break down much lower. 02:56.130 --> 03:02.130 So clearly this is a cell signal and with a bigger spread out pattern like this you probably could just 03:02.130 --> 03:06.460 go ahead and put the stop loss somewhere in the second candlestick. 03:06.450 --> 03:09.540 And where do you get your signal to reverse. 03:09.540 --> 03:14.130 Well right here in support you get an inverted hammer the brakes to the upside. 03:14.190 --> 03:21.230 So it did in fact work these candlesticks though sometimes can lead to massive moves lower. 03:21.240 --> 03:26.490 And for that matter as I recorded this it still hasn't hit your stop loss had you decided to write it 03:26.490 --> 03:30.480 out but obviously this is a downtrend. 03:30.480 --> 03:33.740 There was support there so it would make sense to take advantage of this. 03:33.900 --> 03:38.700 These candlestick painters don't happen that often on the daily charts and when they do you really should 03:39.180 --> 03:40.030 pay attention. 03:40.090 --> 03:49.450 And in fact I can see a slight gap here so that technically did work itself out and you can see that 03:49.450 --> 03:50.430 we got a nice run up. 03:50.440 --> 03:53.000 We got a hammer back here when you would have gotten in. 03:53.110 --> 03:58.290 So that offered support and really this shooting star was your first sign of trouble you probably would 03:58.290 --> 03:59.320 have gotten out up here. 03:59.320 --> 04:04.280 So that's an even better example of the three white soldiers very strong painters. 04:04.330 --> 04:05.730 Don't happen all the time. 04:05.800 --> 04:09.700 Show a continuation and a resiliency that you should pay attention to.