Three Rising Valleys
BullishReversalIntermediateEach dip stops higher than the last. Sellers are losing ground.
Verdict: SkipBitcoin 4H: 2 trades, won 0%, avg trade −6.7% vs random day +0.4% (too few trades to judge). Backtest
After a decline, price makes a low and bounces.
step 1/7
Trade rules
| Direction | Long (buy) |
|---|---|
| Entry | After the third valley is confirmed, a candle CLOSES above the highest peak between the valleys, within half the pattern length plus 5 candles. Each valley is higher than the last by at least 15% of the pattern height, 5+ candles apart (neither gap over 3x the other), and the decline into it started above that peak. |
| Cancelled if | Price trades below the third valley before that close. |
| Target | Pattern height, projected from the breakout |
3 common mistakes
- Buying the third valley before the peak breaks.
- Using the lower peak: the line to beat is the highest one.
- Stop under the first valley: the third valley is what must hold.
Backtest
same rules every time · equal size · no fees · method| Market | Trades | Won | Avg trade | Random day |
|---|---|---|---|---|
| Bitcoin · 4H · 2017-2026 · too few trades to judge | 2 | 0% | −6.68% | +0.38% |
| US large caps (50) · 1D · 2016-2026 | 28 | 39% | −1.22% | +1.94% |
Verdict: SkipLost money on average on US large caps. Bitcoin had too few signals to judge.
pattern −34%random +54%