Win Investings Continuation Type 5:
Darren says” My 5th Reversal type is the Bearish Thee Line Strike – this formation occurs deep into a prolonged downtrend where short traders are very active. The setup starts with three long down days as is illustrated below. On the fourth day the market opens lower but closes up strongly near the open of the first day. A fifth day of confirmation should be sought to confirm bearish sentiment is still intact.”
Darren also says “The Bearish Three Line Strike occurs after increased selling in an already established down trend. All trends create a certain rate at which prices change on a daily basis with some stocks moving faster than others in any given direction. If this rate increases exponentially one could speculate that either an external even or news of such an even coming has sparked the increase in demand or supply. Traders try to estimate the rate at which the prices change and take a detailed look as to the circumstances that cause this rate to change.”