What is the falling three methods pattern?
The falling three methods is a bearish continuation pattern. A strong red candle, three small bounce candles held inside its range, then a new red breakdown.
How does the falling three methods form?
A strong red bar, three small bounce bars contained inside its range, then a new red bar closing below the first.
How do you confirm a falling three methods?
A bounce that stays inside the red bar's range never really challenged it. Containment is the whole test.
When does the falling three methods fail?
It fails when the bounce bars grow. Each one larger than the last is not a pause, it is demand arriving.
No chart pattern works every time. The examples on this page were chosen because they show the pattern clearly, and in real markets patterns fail often.
Practice on real charts
3 real examples of the falling three methods, cut off where the pattern completed. Make your call, then see what happened.
The shaded area is a falling three methods. Where did price go next?
