What it is
Three Rising Valleys is a bullish continuation pattern consisting of three successive troughs, each higher than the previous one, connected by moderate rally peaks. The pattern shows that each pullback finds buyers at progressively higher levels.
Unlike a simple uptrend of higher lows, this pattern has a specific structure: three well-defined valleys (pullback lows) that form over weeks to months, with the breakout occurring above the highest peak between the valleys.
Bulkowski's research shows this pattern performs well because it demonstrates consistent buying pressure across multiple corrections — each dip is bought more aggressively than the last.
The psychology
Each valley tests buyers, and each time they step in at higher prices. This shows growing confidence and accumulating demand.
The three-valley structure filters out random noise. One higher low could be coincidence. Two shows intent. Three confirms a systematic shift in the supply/demand balance.
The breakout above the pattern's peak occurs when sellers who were distributing at resistance finally get overwhelmed by the rising tide of buying pressure.
Identification
- 01Three distinct troughs — Each higher than the previous
- 02Rally peaks between valleys — Creates the resistance to break
- 03Progressive higher lows — Clear ascending structure
- 04Breakout above the highest peak — Confirms the pattern
- 01Valleys spaced evenly — Orderly structure
- 02Volume increases at each valley — Growing demand
- 03Rising volume on breakout — Confirms conviction
- 04Pattern over weeks/months — More significant than days
- 01Third valley lower than second — Not ascending
- 02Breakout fails quickly — False breakout
- 03Declining volume on each rally — Weakening demand
- 04Valleys are too close together — May be noise
Execution framework
Enter on breakout above the highest peak between the valleys with volume confirmation.
Below the third (highest) valley. This is the most recent higher low and the pattern's anchor.
The height of the pattern (highest peak minus lowest valley) projected from the breakout point.
Typically 1:2 depending on the pattern's height and the stop distance.
Context matters
Three Rising Valleys show systematic accumulation. Each pullback bought at higher prices means persistent demand.
- 01Valleys well-defined with clear swing lows
- 02Volume expands on each rally
- 03Higher timeframe trend is bullish
- 04Pattern forms over weeks to months
- 01Valleys barely rising (nearly flat)
- 02Declining volume throughout
- 03Pattern against the macro trend
- 04Third valley makes a marginal new high
Three rising valleys is the chart pattern version of 'the dip keeps getting bought.' Each valley is a vote of confidence from buyers.
Compare the full pattern set
Use the library to compare similar structures before deciding what the chart is actually building.