What it is
Three Black Crows is a three-candle bearish reversal pattern that appears at the top of an uptrend. It consists of three consecutive long-bodied bearish (red/black) candles, each opening within or near the body of the previous candle and closing at progressively lower lows.
The pattern gets its name from the ominous image of three crows perched on a tree - a traditional symbol of bad news. Each "crow" represents a session where sellers took decisive control, creating a stair-step decline of lower prices.
The psychology
Three Black Crows tells a story of sustained seller conviction over multiple sessions. Unlike single-candle reversals that can be anomalies, this pattern shows that sellers are not just stepping in - they're dominating for three consecutive periods.
Day one: After an uptrend, sellers emerge and push price significantly lower. Day two: Instead of a bounce, sellers return with the same or greater force, opening within the previous body and closing at new lows. Day three: The same pattern repeats, confirming that momentum has decisively shifted.
The small lower wicks show buyers are unable to push back meaningfully. The consecutive lower closes demonstrate growing fear. This combination sends a powerful message: the bulls have lost control, and a new bearish trend may be beginning.
Identification
- 01Prior uptrend - Pattern must appear after a meaningful advance
- 02Three consecutive bearish candles - All three must be red/black bodies
- 03Long bodies - Each candle should have a substantial real body
- 04Opens within previous body - Each candle opens within or near prior body
- 01Small lower wicks - Little to no buying pressure on closes
- 02Increasing volume - Rising volume confirms seller conviction
- 03Resistance confluence - Pattern forms at known resistance level
- 04Similar body sizes - Balanced, consistent decline
- 01No prior uptrend - In a downtrend, may signal exhaustion instead
- 02Long lower wicks - Suggests buying pressure and potential bounce
- 03Small bodies - Doji-like candles show indecision, not conviction
- 04Gaps between candles - Should open within, not gap below
Execution framework
Conservative: Enter short on a bounce to the midpoint of the third candle body.
Aggressive: Enter short on the close of the third candle or on break below its low.
Place stop above the high of the first crow. This is the origin of the reversal - if price returns there, the pattern has failed.
T1: Previous swing low or nearest support level. T2: Measured move equal to the pattern's height projected downward. T3: Use trailing stop for trend continuation.
Minimum 1:2 R:R required. Bounce entries typically offer better R:R than breakdown entries.
Context matters
Three Black Crows is most powerful when it appears after a clear uptrend at a key resistance level. The context determines whether it's a high-probability reversal or a potential trap.
- 01At major horizontal resistance after a significant rally
- 02Following a period of buying climax/euphoria
- 03With increasing volume on each crow
- 04After bearish divergence on RSI or MACD
- 05Breaking below an ascending trendline
- 06At key Fibonacci extension levels
- 01In an already established downtrend (may signal exhaustion)
- 02Into major support without a prior uptrend
- 03With decreasing volume on each candle
- 04In choppy, sideways market conditions
- 05After extended decline with long lower wicks
- 06Against strong higher-timeframe uptrend
Check if each crow opens within the body of the previous candle. If they gap down instead, the selling pressure is even more intense.
Compare the full pattern set
Use the library to compare similar structures before deciding what the chart is actually building.