Section I · The Japanese Candlestick Bible · Chapter 8
Continuation and multi-candle patterns
Pauses in the trend – the three methods, mat hold, tasuki gap – and the longer reversal patterns of 4–5 candles.
Video · 11 min9 patterns4 exercises
Video lesson with voice-over and charts · 11 minEnglish subtitles
Not all patterns predict a reversal. Continuation patterns show a pause in the trend – the place where professionals add to their positions. Here you'll also find a few longer reversal patterns (4–5 candles).
№
Pattern
Type
Reliability
54
Rising Three Methods
Bullish – continuation
★★★★☆
55
Falling Three Methods
Bearish – continuation
★★★★☆
56
Mat Hold
Bullish – continuation
★★★★☆
57
Upside Tasuki Gap
Bullish – continuation
★★★☆☆
58
Downside Tasuki Gap
Bearish – continuation
★★★☆☆
59
Side-by-Side White Lines
Bullish – continuation
★★★☆☆
60
Ladder Bottom
Bullish reversal
★★★☆☆
61
Bullish Breakaway
Bullish reversal
★★★☆☆
62
Bullish Three-Line Strike
Bullish – continuation (disputed)
★★★☆☆
№ 54
Rising Three Methods
Bullish ▲Bullish – continuation5 candles★★★★★
Japanese name: uwa sanpo
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A long bullish candle, 3 (sometimes 2–4) small bearish candles that stay within its range, and a new long bullish candle that closes at a new high.
How to recognize it
Uptrend
Candle 1: long bullish
2–4 small corrective candles within the range of candle 1
Last candle: long bullish, closes above the close of candle 1
The psychology
Buyers “rest” – profits are taken in a small pullback, but sellers can't push price below the start of candle 1. Then the trend continues.
How to trade it
Entry
At the close of the fifth candle or on a break above its high.
Stop-loss
Below the low of the pullback.
Target
Measured move: the length of candle 1 added to the breakout.
№ 55
Falling Three Methods
Bearish ▼Bearish – continuation5 candles★★★★★
Japanese name: sage sanpo
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A long bearish candle, 3 small bullish candles within its range and a new long bearish candle closing at a new low.
How to recognize it
Downtrend
Candle 1: long bearish
2–4 small corrective candles within the range of candle 1
Last candle: long bearish, closes below the close of candle 1
The psychology
Sellers pause, buyers try a weak bounce but fail to break the open of candle 1. The trend continues down.
How to trade it
Entry
At the close of the last candle.
Stop-loss
Above the high of the pullback.
Target
Measured move – the length of candle 1.
№ 56
Mat Hold
Bullish ▲Bullish – continuation5 candles★★★★★
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Similar to the rising three methods, but the first corrective candle gaps up and the pullback is shallower – it stays in the upper half of candle 1.
How to recognize it
Uptrend
Candle 1: long bullish
Candle 2: small, with a gap up
Candles 3–4: shallow pullback
Candle 5: bullish, closes at a new high
The psychology
The pullback is so shallow that it shows how strong the buyers are – nobody wants to sell.
How to trade it
Entry
At the close of candle 5.
Stop-loss
Below the low of the pullback.
Target
Measured move.
№ 57
Upside Tasuki Gap
Bullish ▲Bullish – continuation3 candles★★★★★
Japanese name: tasuki
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Two bullish candles with a gap between them and a third bearish candle that partly fills the gap but doesn't close it.
How to recognize it
Uptrend
Candle 1: bullish
Candle 2: bullish, with a gap up
Candle 3: bearish, opens within the body of candle 2 and closes inside the gap without closing it
The psychology
The pullback is the sellers' attempt to close the gap, but it survives – the gap turns into support.
How to trade it
Entry
At the close of candle 3 or on a retest of the gap.
Stop-loss
Below the lower edge of the gap.
Target
New high, 2R.
№ 58
Downside Tasuki Gap
Bearish ▼Bearish – continuation3 candles★★★★★
Japanese name: shita banare tasuki
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Two bearish candles with a gap down between them and a third bullish candle that partly fills the gap.
How to recognize it
Downtrend
Candle 1: bearish
Candle 2: bearish, with a gap down
Candle 3: bullish, closes inside the gap without closing it
The psychology
The buyers' bounce fails to close the gap – the gap becomes resistance.
How to trade it
Entry
At the close of candle 3.
Stop-loss
Above the upper edge of the gap.
Target
New low, 2R.
№ 59
Side-by-Side White Lines
Bullish ▲Bullish – continuation3 candles★★★★★
Japanese name: narabi aka
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A bullish candle followed by a gap up and two nearly identical bullish candles side by side with almost equal opens.
How to recognize it
Uptrend
Candle 1: bullish
Candles 2 and 3: bullish, with a gap up, nearly the same size and open
The psychology
Buyers defend the same opening level above the gap twice in a row – the trend continues.
How to trade it
Entry
At the close of candle 3.
Stop-loss
Below the gap.
Target
2R.
№ 60
Ladder Bottom
Bullish ▲Bullish reversal5 candles★★★★★
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Three bearish candles with lower opens and closes (like a ladder), a fourth bearish candle with an upper wick and a fifth bullish candle with a gap up.
How to recognize it
Downtrend
Candles 1–3: bearish, lower opens and closes
Candle 4: bearish, with a long upper wick
Candle 5: bullish, opens above the body of candle 4
The psychology
Sellers walk down the ladder, but on the fourth rung buyers are already showing up (the upper wick), and the fifth candle confirms the reversal.
How to trade it
Entry
At the close of candle 5.
Stop-loss
Below the low of candle 4.
Target
2R.
№ 61
Bullish Breakaway
Bullish ▲Bullish reversal5 candles★★★★★
contextfollow-through
A long bearish candle, a gap down, three smaller candles with lower lows and a long bullish candle that closes inside the gap between candles 1 and 2.
How to recognize it
Downtrend
Candle 1: long bearish
Candle 2: bearish, with a gap down
Candles 3–4: small, continuing down
Candle 5: long bullish, closes inside the gap
The psychology
The trend accelerates but loses strength. The final bullish candle erases the last three periods and signals a reversal.
Three bullish candles (like three soldiers) followed by a big bearish candle that erases the entire rise of the three. Classically it's read as a continuation up after a “cleanout”.
How to recognize it
Uptrend
Candles 1–3: bullish, with new highs
Candle 4: bearish, opens above candle 3 and closes below the open of candle 1
The psychology
The classic interpretation: short-term buyers are shaken out, positions are “cleaned out”, and the trend continues. Caution: statistical research (Thomas Bulkowski) shows that the pattern often acts as a bearish reversal. So ALWAYS require confirmation.
How to trade it
Entry
Only after confirmation – a bullish candle above the high of candle 4.
Stop-loss
Below the low of candle 4.
Target
The previous high, then 2R.
Exercises
Test yourself on the chart
0 of 4 correct
1Where is price more likely to go after these candles?
2Tap any candle of the “Upside Tasuki Gap” pattern on the chart.
Tap a candle on the chart.
3“Bullish Breakaway”: you go long (buy) at the close. Where do you put the stop-loss?
Tap the chart where you would put the stop-loss.
4What is the pattern in the frame called?
Key points
Continuation patterns show where professionals add to their positions.
The three methods are the Japanese version of the flag.
The bullish three-line strike is controversial – always require confirmation.
