How to Trade the 3 Bar Play Pattern

Traders are always on the lookout for patterns. That’s because they can help to predict price movements — whether it’s upwards or downwards. After all, no one can predict the future, but being able to correctly guess helps many traders have a regular income.

That’s where different trading patterns come in. There are many types, each with its own pros and cons. It’s up to the trader to decide which one to use depending on what they’re trading and want to achieve.

Today, we’ll be discussing the 3 bar play indicator for trading. It involves checking for movements that indicate if they’ll be a trend reversal or not.

Below, we discuss various aspects of this indicator including how to use volume profile indicator in this pattern identifier. We’ll also look at the pros and cons of using this trading pattern and other 3 bar phrases you should be aware of.

What’s the 3-Bar Play Pattern?

It’s a popular trading chart pattern made up of three (and sometimes four) successive “candlesticks”. These appear in an upward trend, downward trend, or stable market. Additionally, it’s used to show a reversal or stability in a trend based on where the pattern is on the chart.

Bullish rising candles and bearish falling candles make up a typical 3 bar play pattern. Therefore, depending on what you see in the chart pattern, you can predict bearish or bullish trends coming up.

So, in summary, the main purpose of the 3 bar pattern is to identify signals of a market trend reversal. Three consecutive candle patterns make up the pattern’s identification. And, based on their movements, there’s a sign of whether a reversal in the trend is likely to happen.

Identifying and Using the 3 Bar Play Pattern For Forex Trading?

Forex trading has its own rules when compared to other types of assets. However, you can still use the 3 bar play chart to help you predict forex values. But first, here’s how to identify a bullish 3 bar play indicator Thinkorswim users are familiar with.

  1. Look for the first bullish candle. It’s long and above the average bar size.
  2. The next candle is a bearish downward candle. You’ll notice that the opening price is level with the first candle’s closing price.
  3. Next, is the third candlestick. This one is bullish and has an opening price that’s level to the second candle’s price at closing. It also has a closing price that’s above the second candle’s price at closing.

The chart below is taken from the ThinkorSwim Platform for EURGBP Forex pair. The xBrat Roller Coaster produces a signal (green up arrow) even before the 3 bar pattern is formed. The rules up above describe the pattern on the chart with the first of the 3 bars being the candle/bar where the green arrow is.

3 bar patter and xbrat roller coaster

Regarding how to actually use it, looks out for the first long bar when checking the prices of a currency you want to trade. This will indicate the 3 bar pattern. Use the moving average or another momentum indicator to double-check the pattern’s signal.

Furthermore, use tools such as excel to further read into the moving average patterns. Enter your data and use the modify status bar to display min function, then take it from there.

When the third candlestick rises over the second middle candlestick, enter a position. Then, as you would with any trading strategy, set a stop-loss at the highest or lowest level of the first candle. Also, when you see the next Fibonacci retracement level, set up your take-profit target.

Trading Foreign Currencies With the 3 Bar Candle Pattern

Below, we give an example of how to use a 3 bar play indicator MT4 forex traders customers use too. It’s popular with them because the 3 bar pattern shows if the price is likely to get out of range based on the candlesticks patterns.

  1. Identify the 3 Bar Play pattern by looking for three consecutive bars on the Forex chart. The first bar should be a bearish bar (red). This is followed by a small bullish bar (white or green), and then another bearish bar that is bigger than the first one. When you see this, it’s a pattern that indicates a possible reversal from a downtrend to an upward trend.
  2. Once you identify the 3 Bar Play pattern, confirm it with other technical indicators such as moving averages. This helps to determine the pattern’s strength and the trend’s direction.
  3. With a confirmed 3 Bar Play pattern and the trend is reversing to an upward trend, you can place a long (buy) trade. Conversely, if the trend is reversing from an upward trend to a downward trend, you should place a short (sell) trade.
  4. Set your stop loss and take profit levels in order to manage your risk. This helps to limit potential losses.
  5. After the trade, monitor it and adjust your stop loss and take profit levels accordingly. Also, consider closing the trade if the trend changes direction or if other technical indicators suggest a reversal.

The 3 Bar Play Pattern – Pros and Cons

As with all other trading pattern indicators, the 3 Bar Play Pattern has both benefits and drawbacks. Being aware of these helps you decide if it’s the right indicator for your trading strategies.


  • It’s easy to see in a chart, making it accessible for traders of all experience levels.
  • The 3 Bar Play Pattern offers a strong indicator for short-term trading strategies.
  • It’s ideal for day traders, so it’s a commonly used chart pattern for intraday time frames.


  • Using the 3 Bar Play Pattern requires discipline as you need to follow the strategy consistently. This helps to manage risk better.
  • It’s not suitable for volatile markets and so can only be used for trending markets.
  • You can’t use it without conforming with other technical indicators.

The Difference Between A Three Bar Reversal Pattern And The Three Bar Play Pattern

Both the 3 bar play reversal pattern and 3 bar play pattern have three candles that indicate a level for entry. But, the main difference between the two is how they’re developed and what the patterns look like.

The 3 bar play pattern’s first formation starts with an initial bar bullish candlestick. This is followed by a small bearish candle and then a third bullish candle whose price closes over the second candle’s price.

The 3 bar play indicator reversal pattern, on the other hand, is made up of two down-trending candles and a third upward-trending candle whose price closes on top of the first candle.


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