The Three Inside Up Candlestick Pattern: A Strong Bullish Reversal Confirmation
Reversals don’t always happen suddenly. Sometimes, they start with a hint—and then grow into something more convincing. That’s exactly how the three inside up candlestick pattern works. It starts with a subtle shift, followed by a stronger confirmation that the bulls might be taking back control.
This pattern often shows up after a downtrend and gives traders a chance to catch a potential reversal with just the right amount of early confirmation.
What the Pattern Looks Like
Three candles that turn the tide
The three inside up candlestick pattern includes:
1. A large red candle continuing the current downtrend
2. A small green candle that forms inside the body of the red candle
3. Another green candle that closes above the high of the first candle
It’s essentially a bullish harami pattern—followed by a strong confirmation candle that pushes price higher. That third candle is what gives traders more confidence in the reversal.
What It Tells You
Sellers are losing momentum
The first red candle shows that sellers are still in control. But the second candle—smaller and bullish—signals hesitation. When the third candle closes above the first candle’s high, it suggests that buyers are stepping in and shifting the momentum.
That’s why this pattern is more reliable than the harami alone. It gives traders both a signal and a follow-through.
Where It Works Best
Use it after real selling pressure
The three inside up candlestick pattern gains meaning when it appears at the right place in the chart.
Here are a few examples of where it becomes more powerful:
How Traders Use It
Looking for confirmation and confluence
Traders don’t just spot the pattern—they wait for the third candle to confirm the signal. Once that candle breaks above the first candle’s high, it adds credibility.
Here’s how a typical approach looks:
Many traders enter just above the third candle’s high, with a stop below the pattern’s low.
Example in the Market
Let’s say GBP/JPY has been dropping. A big red candle forms, followed by a small green candle tucked inside it. On the next day, a larger green candle forms and closes above the red candle’s high.
That’s a valid three inside up candlestick pattern.
If RSI starts turning upward and price reacts near a support zone, it’s a signal some traders use to consider a long trade.
Why It’s Trusted
It’s subtle—but powerful
The three inside up candlestick pattern isn’t dramatic, but that’s part of its strength. It starts with a quiet reversal, and then confirms it. For traders who prefer a little more certainty before entering, this pattern strikes a great balance.
Next, we’ll explore the Three Inside Down pattern, which flips the setup and signals potential bearish reversals instead.