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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.
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.
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.
Three Rising Valleys show systematic accumulation. Each pullback bought at higher prices means persistent demand.
Three rising valleys is the chart pattern version of 'the dip keeps getting bought.' Each valley is a vote of confidence from buyers.
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