# Three Bar Reversal Pattern Three Bar Reversal Pattern is an indicator on [Vela](https://vela.luxalgo.com/chart), our next-generation charting platform, written in Pine Script®. Automatic detection for three-bar reversal patterns, drawn straight on the price chart with support and resistance levels derived from each pattern's boundaries. Normal, Enhanced, or All detection modes control strictness, and an optional trend filter using a Moving Average Cloud, Supertrend, or Donchian Channels keeps aligned or contrarian signals. - Indicator in the LuxAlgo Library, by LuxAlgo, published Oct 9, 2024. - Access: free. - Concepts: [Three-bar Reversal](https://www.luxalgo.com/library/concept/three-bar-reversal/) (primary) - Open on Vela: https://vela.luxalgo.com/chart?pineScriptCodeId=cmpwn6jj10099vhsg63f682da - Page: https://www.luxalgo.com/library/indicator/three-bar-reversal-pattern/ The **Three Bar Reversal Pattern** indicator automates detection of the [three-bar reversal](https://www.luxalgo.com/library/concept/three-bar-reversal/), a compact sentiment shift in which two bars extend the prevailing move and a third turns against it. Each confirmed pattern is marked on the chart and unpacked into levels: the pattern's upper boundary often serves as resistance and its lower boundary as support, giving retracements and breakouts a concrete frame. ## How to Trade the Three Bar Reversal Pattern? - **Pattern marker**: a potential reversal flagged directly on price as the third bar completes the formation. - **Normal pattern**: the third bar's high or low clears the first bar's extreme but its close does not, for earlier but softer signals. - **Enhanced pattern**: demands the third bar close beyond the first bar's high or low, for fewer and clearer reversal indications. - **Derived levels**: pattern boundaries become support and resistance for planning retracement entries or breakout continuations. - **Trend filtering**: keep only patterns aligned with the trend read from a Moving Average Cloud, Supertrend, or Donchian Channels, or deliberately hunt 'Opposite' prints for contrarian setups. Filtering is what makes the tool selective: raw reversal patterns appear frequently, and pinning detection to a trend regime turns a census of formations into a shortlist worth acting on. ## Three Bar Reversal Pattern Settings - **Pattern Type**: Normal, Enhanced, or All. - **Derived Support and Resistance**: draw the levels from pattern boundaries as a Level or a Zone, or turn them off with None. - **Filtering**: pick the trend indicator and whether patterns must be 'Aligned' or 'Opposite'. - **Moving Average Cloud**: SMA, EMA, HMA (default), RMA, WMA, or VWMA type with fast and slow lengths. - **Supertrend**: ATR length and multiplier; **Donchian Channels**: calculation length. ## Frequently Asked Questions ### Should I run Normal or Enhanced patterns? Enhanced requires the third bar to close beyond the first bar's high or low, trading frequency for conviction. 'All' shows both classes at once, which is a practical way to compare their behavior on your market before committing to either. ### How should the trend filter be set? 'Aligned' keeps only reversals that agree with the prevailing trend, while 'Opposite' looks for counter-trend prints. Each of the three trend indicators is configurable, so the regime definition can run as fast or as slow as your timeframe demands. ### Where can I get this pattern indicator? It is free of charge on the LuxAlgo Library, and Quant, our coding agent, can run and backtest it straight from this page. For a broader menu of reversal detections beyond the three-bar structure, see [Reversal Signals](https://www.luxalgo.com/library/indicator/reversal-signals/). You can also copy the source code from this page and run it anywhere Pine Script® runs. ## Related indicators - [N Bar Reversal Detector](https://www.luxalgo.com/library/indicator/n-bar-reversal-detector/) (Three-bar Reversal): markdown at https://www.luxalgo.com/library/indicator/n-bar-reversal-detector.md - [Candle 2 Closure](https://www.luxalgo.com/library/indicator/candle-2-closure/) (Two-bar Reversal): markdown at https://www.luxalgo.com/library/indicator/candle-2-closure.md - [Long Wick Detector](https://www.luxalgo.com/library/indicator/long-wick-detector/) (Pin Bar): markdown at https://www.luxalgo.com/library/indicator/long-wick-detector.md - [The Strat](https://www.luxalgo.com/library/indicator/the-strat/) (Inside Bar): markdown at https://www.luxalgo.com/library/indicator/the-strat.md - [Wide-range Bar](https://www.luxalgo.com/library/indicator/wide-range-bar/) (Chart & Candlestick Patterns): markdown at https://www.luxalgo.com/library/indicator/wide-range-bar.md - [Engulfing Bar](https://www.luxalgo.com/library/indicator/engulfing-bar/) (Chart & Candlestick Patterns): markdown at https://www.luxalgo.com/library/indicator/engulfing-bar.md - [CBC Flip with Targets and Filters](https://www.luxalgo.com/library/indicator/cbc-flip-with-targets-and-filters/) (Two-bar Reversal): markdown at https://www.luxalgo.com/library/indicator/cbc-flip-with-targets-and-filters.md - [Exhaustion Bar](https://www.luxalgo.com/library/indicator/exhaustion-bar/) (Chart & Candlestick Patterns): markdown at https://www.luxalgo.com/library/indicator/exhaustion-bar.md --- Source: https://www.luxalgo.com/library/indicator/three-bar-reversal-pattern/ (LuxAlgo Library). Free to use with attribution: https://www.luxalgo.com/library/license/