Rising Three Methods
This pattern starts out with what is called a "long white day". Then, on the second, third and fourth trading sessions small real bodies appear - these small real bodies form from a fall-off in price, but they still stay within the price range of the long white day (day one in the pattern). The fifth and last day of the pattern shows another long white day.
This pattern is, in the world of Japanese candlestick charting, a very bullish chart. It shows an upward trend on day one with investors taking a few trading sessions to relax to prepare for the next rise in price that occurs on the fifth day. Even though the pattern shows us that the prices are falling for three straight days, a new low is not seen and the bulls prepare for the next leg up.
Bullish Mat Hold
This pattern begins with a long white day and then, on the second day of trading, the issue gaps up and is a black day. What we see next in this pattern is somewhat similar to the previous pattern.
Separating Lines (Bullish)
In the pattern of bullish separating lines, you can see that the first day is a black day and the next day is a white day. The key to the second day is that the issue has the same opening price as day one.
In a bullish market, this pattern is simply viewed as a continuation of the trend because the second day starts off from where day one left off and continues the trading session to close higher still.
Now, on the bearish side of the equation, let's have a look at what the bears are looking for, starting with separating lines.