Three Black Crows

Alfred Hitchcock’s use of ominous black crows even made its way into the stock market. Investors who study trends in the market to make short-term decisions look for certain patterns in trades, not unlike mystics look for patterns in tea leaves on the bottom of their cups for future predictions (are things getting creepy, yet?). One of these patterns is three black crows, which yes, is ominous indeed.

The pattern is three long candlesticks all in a row. This is a bearish pattern (as opposed to “bullish”), which means it’s a downtrend. Each one begins in the middle of the previous candlestick, and ends lower than the previous candlestick. Investors who recognize the three black crows interpret it to mean that it’s the start of a bearish downtrend, meaning it will continue to go down.

What goes up must come down.