<p>Three Black Crows is a bearish candlestick pattern that appears when three consecutive long‑bodied candles close lower than the previous one, indicating sustained selling pressure and potential trend reversal.</p>

<h2>How It Works</h2>
<p>The pattern forms in an uptrend or after a rally.</p>
<ul>
<li><strong>First candle:</strong> A long bearish candle that closes near its low, showing initial weakness.</li>
<li><strong>Second candle:</strong> Another long bearish candle opens within the body of the first and closes even lower, confirming momentum.</li>
<li><strong>Third candle:</strong> A third long bearish candle repeats the process, closing below the second candle’s low.</li>
</ul>
<p>Each candle typically has little or no upper shadow, reinforcing that buyers failed to push prices higher during the session. The pattern is considered most reliable when the candles are of similar size and appear after a clear upward move.</p>

<h2>Why It Matters</h2>
<p>Traders use Three Black Crows as a signal to consider short positions or to exit long trades.</p>
<p>Example: A stock rises from $50 to $55 over two weeks, then forms three consecutive bearish candles closing at $53, $51, and $49. The pattern suggests the rally may be exhausted, prompting a trader to sell or short the stock near $49 with a stop‑loss above the recent high.</p>
<p>Recognizing this pattern helps investors anticipate downside momentum and manage risk in volatile markets.</p>