How to Read a Three Outside Down Pattern
A bearish engulfing pattern followed by a third bearish candle closing lower still, confirming the reversal.
CANDLESTICK PATTERNS
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3-candle pattern · Bearish reversal (confirmed)
A three outside down pattern is a bearish engulfing pattern followed by a third bearish candle that closes lower still, confirming the reversal rather than leaving it as a single session’s move. It’s the direct bearish equivalent of three outside up.
Because it builds on an already-strong bearish engulfing signal with a full session of follow-through selling, it’s generally treated as one of the more reliable multi-candle bearish setups covered here.
Related patterns
This article is educational only and isn’t a recommendation to trade any particular instrument or pattern — no candlestick pattern works in isolation. See the full candlestick guide for how patterns like this one fit into a broader approach.