Three-Bar Inside Bar on HD Daily

HD Big Picture – Three-Bar Inside Bar

HD has been bullish for a long period.

1. The bull trend line is holding up.
2. Recently, HD had deeper pullbacks which led to the trading range.
3. The first break-out above the trading range was rejected strongly. However, price soon broke out again and is currently pulling back to test the high of the trading range.

HD Small Picture – Three-Bar Inside Bar

This close up chart of HD shows the three-bar inside bar pattern. The bullish three-bar inside bar pattern consists of:

• A higher close
• An inside bar
• A higher close (the last bar on the chart)

(Learn more: Three-Bar Inside Bar Pattern)

Let’s look at this chart.

1. Price broke out once but failed. The second break-out managed to close above high of the earlier break-out.
2. Price is finding support at the trend line with the three-bar inside bar. The first bar of the pattern showed rejection by the trend line. The second bar, which is the inside bar, showed uncertainty but was still unable to close below the trend line. The last bar made a higher close and completed the three-bar inside bar pattern.

Three-Bar Inside Bar Analysis

HD is clearly in a long-term bull trend.

For trading a break-out pullback from the wide trading range, the bullish three-bar inside bar pattern is a low risk entry point.