The Ultimate Guide to Three Mountain Top Candlestick Patterns

Last updated: January 4, 2024

Three Mountain Top Pattern

The three mountain top candlestick pattern occurs when a stock retreats from its highs three times and is unable to hold the price:

Chart

General Identification & Interpretation

Steve Nison is credited with bringing Japanese candlestick charting to the West. In his book "Japanese Candlestick Charting Techniques" he describes three mountain top patterns with the following characteristics:

Typical characteristics

• Stock backs off from its highs (or makes attempts at highs) three times
• The three peaks of the pattern don't necessarily have to be at the same price
• The last high peak of the pattern should be confirmed with a bearish candle

Examples of use as a trading indicator

• Represents a major top
• The neckline of the head and shoulders pattern could be used as future resistance line

Other interpretations

• If the middle peak in the pattern is the highest peak, this pattern is known as a three Buddha top pattern

More for beginners

Check out our quick start guide to candlestick charting for more information if you are new to candlestick charting!