CDL3LINESTRIKE (CDL3LINESTRIKE)

CDL3LINESTRIKE (Three-Line Strike) is a powerful four-candle continuation pattern. For bullish version: First three candles are consecutive bullish candles with higher closes (three white soldiers pattern). The fourth candle opens above the third candle but reverses dramatically, closing below the first candle's open - appearing to reverse the entire rally. However, this 'strike' candle actually indicates continuation: it represents profit-taking that creates a buying opportunity before the uptrend resumes. The bearish version is inverted: three consecutive bearish candles followed by a bullish strike candle that engulfs them all, signaling downtrend continuation after the bounce fails.

Three-Line Strike is counterintuitive but statistically powerful - the dramatic reversal candle often precedes strong continuation in the original trend direction. For bullish strikes during uptrends, consider the fourth candle's deep pullback as a buying opportunity, entering when price breaks above the fourth candle's high. For bearish strikes in downtrends, the fourth candle's rally is a shorting opportunity when price breaks below its low. This pattern requires experience as it looks like a reversal but acts as continuation. Crypto traders often miss this pattern's significance, making it valuable for informed traders. Combine with trend indicators: ensure 50-day MA is supporting the trend, MACD shows strong directional momentum, and volume confirms the continuation move after the strike candle. Higher reliability when the strike candle has very high volume.