Downside Gap Three Methods
- Type: Continuation
- Relevance: Bearish
- Prior Trend: Bearish
- Reliability: Medium
- # of Sticks: 3
Definition:
This pattern and the Tasuki Gap and very similar but the difference is the Downside Gap Three Methods fills the gap set by the first two candles while the Tasuki does not. The Gap Three Method should also make people think about how a downtrend line is created. Slightly rallies like this are needed to provide another valid point to connect to. This pattern also makes sense psychologically in that stops get moved lower as people have a winner and a move like this can wipe out stops to prepare for another leg down.