What is 3 bars down? — chart signal explained
There's no fancy math behind this one — it just counts how many candles in a row have closed lower. A candle counts as 'down' when it finishes below the previous candle's close, and the signal tracks how long that run goes unbroken.
When does it fire? — BaroBara criteria
It lights up once three or more candles in a row close below the close before them. Despite the 'day' in the name, it follows whatever timeframe you're viewing — on a 15-minute chart, that means three straight 15-minute candles closing lower — and it stays on while the run stretches to four, five, or more.
How traders usually read it
Some traders see three straight down closes and figure the selling is getting stretched, hoping a bounce is near. Others read the exact same run as a downtrend settling in. It's a classic case of one picture, two opposite readings.
What to watch out for
It only counts how many times price fell, not how far. Three tiny dips and three sharp drops trigger it identically. And in a weak market, runs of four, five, or more down candles are common — reaching three gives the slide no reason to stop.
What the data actually shows (BTC 4h)
The common reading is a bounce (up) — but what actually happened matters more. This signal has fired 1007 times on BTC 4h; across the most recent 300, price reached the small target (+0.25%) first about 50% of the time. Widen the target to ±1% and it becomes about 50%. A historical probability, not a guaranteed direction — and it shifts with market regime.
Odds and expected value — with symmetric target and stop (±)
Exactly the barobara framing: which side got hit first, +X% or −X%. Target and stop are set to the same %, and the win rate is how often the upside (+X%) was reached first.
| Target = stop (±) | Win rate (+ first) | EV (before fees) |
|---|---|---|
| ±0.25% | 50% | +0.00% |
| ±0.5% | 51% | +0.01% |
| ±0.75% | 49% | -0.02% |
| ±1% | 50% | +0.00% |
| ±1.5% | 49% | -0.03% |
| ±2% | 49% | -0.04% |
Broken down by market regime
⚠️ This table uses a different basis than the symmetric (±) table above — a small +0.25% target with a wide −3.0% stop (fees included). The small target makes the win rate look high while EV is often negative — exactly what signal groups hide. And the same signal behaves differently across regimes.
| Regime | Win rate (+0.25% target) | EV (−3.0% stop) | Sample |
|---|---|---|---|
| Bear market | 86% | -0.28% | N=349 |
| Sideways | 87% | -0.20% | N=333 |
| Bull market | 89% | -0.19% | N=315 |
Recent occurrences
How far price actually moved the last few times this signal fired (MFE = maximum favorable excursion).
| Date | MFE | Result |
|---|---|---|
| 2026-06-06 | 6.0% | ✅ hit |
| 2026-06-09 | 1.04% | ✅ hit 🔴 stopped |
| 2026-06-12 | 3.49% | ✅ hit |
| 2026-06-16 | 1.25% | ✅ hit 🔴 stopped |
| 2026-06-16 | 1.17% | ✅ hit 🔴 stopped |
| 2026-06-19 | 3.13% | ✅ hit |
| 2026-06-23 | 1.2% | ✅ hit 🔴 stopped |
| 2026-06-25 | 2.73% | ✅ hit |
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