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Thomas Bulkowski’s successful investment activities allowed him to retire at age 36. He is an internationally known author and trader with 30+ years of stock market experience and widely regarded as a leading expert on chart patterns. He may be reached at

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Bulkowski's Bearish Tri-Star

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Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 07/24/2017
21,513 -66.90 -0.3%
9,428 -43.07 -0.5%
719 -6.46 -0.9%
6,411 23.06 0.4%
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19.1%
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21,850 or 21,000 by 08/01/2017
9,950 or 9,400 by 08/01/2017
740 or 685 by 08/01/2017
6,450 or 6,175 by 08/01/2017
2,525 or 2,400 by 08/01/2017

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Bearish Tri-Star: Summary

The bearish tri-star candlestick is an unusual one, but you can say that about the other varieties of candlestick patterns, too. This one acts as a bearish reversal about randomly. It has a frequency rank of 77 out of 103 candle patterns, so it will be hard to find. And when you do find it, do not look for outstanding performance, either. The overall performance is well down the list -- toward the bottom, really.

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Bearish Tri-Star: Important Results

Theoretical performance: Bearish reversal
Tested performance: Bearish reversal 52% of the time
Frequency rank: 77
Overall performance rank: 76
Best percentage meeting price target: 72% (bear market, down breakout)
Best average move in 10 days: -4.29% (bear market, down breakout)
Best 10-day performance rank: 41 (bull market, up breakout)

All ranks are out of 103 candlestick patterns with the top performer ranking 1. "Best" means the highest rated of the four combinations of bull/bear market, up/down breakouts.

The above numbers are based on hundreds of perfect trades. See the glossary for definitions.

The ideal bearish tri-star candlestick
Bearish Tri-Star
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Bearish Tri-Star: Discussion

The bearish tri-star candlestick is supposed to act as a bearish reversal and it does, but only 52% of the time. That is about randomly, so do not try to anticipate the breakout direction. The overall performance rank of 76 is well down the list. That means price is unlikely to form a lasting trend after the breakout.

The best average move 10 days after the breakout is a drop of 4.29% in a bear market. I consider moves of 6% or higher to be good ones, so this falls well short of the goal. The best performance rank 10 days after the breakout is 41 (bull market, upward breakout).

Bearish Tri-Star: Identification Guidelines

CharacteristicDiscussion
Number of candle linesThree.
Price trend leading to the patternUpward.
ConfigurationLook for three doji candles, the middle one has a body above the other two.
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Bearish Tri-Star: Three Trading Tidbits

If you want a few bones from my Encyclopedia of candlestick charts book, here are three to chew on. The pages refer to the book where the tips appear.

  1. Bearish tri-star candles that appear within a third of the yearly low perform best -- page 814-815.
  2. Select tall candles for the best performance -- page 815.
  3. For the best performance, trade the bearish tri-star in an upward retrace of the primary downtrend -- page 816.

Bearish Tri-Star: Example

The bearish tri-star candlestick on the daily scale

The chart shows one example of a bearish tri-star candlestick, circled in red on the daily scale. It appears as a gang of three doji candlesticks, the middle of which has a body above the other two. A doji, by the way, is a candle in which the opening and closing prices are within a few pennies of each other.

The breakout from this bearish tri-star is upward when price closes above the top of the candlestick pattern. That joins the uptrend already underway, so the pattern acts as a continuation candle.

According to my research, the chart shows a good example of where the candle pattern will appear: the start of a retrace that does not carry far.

A better trading setup is to find the bearish tri-star as part of an upward retrace of a downward price trend.

-- Thomas Bulkowski

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See Also

Written by and copyright © 2005-2017 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information. Read my chips: No new upgrades!