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1991issue C031

Candlestick body and shadow construction with three-Buddha peaks

A candlestick bar is constructed from the session open, high, low, and close, with the real body between open and close and thin shadows to the high and low. A three-peak layout with a larger center peak and smaller peaks on both sides is treated as the Japanese counterpart of a head-and-shoulders pattern and is known as the three-Buddha pattern.

  • A candlestick is built from the session open, high, low, and close: the real body is the open-close rectangle, and thin shadows reach the high and low.
  • An empty or white body marks a close above the open; a filled or black body marks a close below the open. The same construction can be read from intraday to monthly charts.
  • A three-peak layout with a larger center peak and smaller peaks on both sides is the three-Buddha pattern, treated as the Japanese counterpart of head and shoulders.
  • Engulfing, dark-cloud, and hanging-man labels are memory aids for wrapping, covering, or hanging visual conditions.
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Current trackHead and shoulders64 readingsCandlestick patterns100 readings

Construct the bar from open, high, low, and close

A candlestick bar is constructed from the session open, high, low, and close. The real body is the thick rectangle bounded only by the session open and close. The high and low print as thin shadows, each a thin extension from the real body out to the session high or low.

Read polarity from an empty or filled body

An empty body, shown as a hollow or white real body, marks a close above the open. A filled body, shown as a solid or black real body, marks a close below the open. The same open-high-low-close construction can be read on charts ranging from intraday to monthly.

Test a three-peak reversal on the same skeleton

A three-peak layout with a larger center peak and smaller peaks on both sides is treated as the Japanese counterpart of a head-and-shoulders pattern and is known as the three-Buddha pattern. Head and shoulders is the matching three-peak reversal hypothesis expressed in Western chart language.

Keep pattern names as memory aids

Engulfing, dark-cloud, and hanging-man labels function as memory aids that describe a wrapping, covering, or hanging visual condition. The engulfing pattern is a wrapping two-bar condition whose Japanese label means to wrap. Dark-cloud cover is a covering condition whose Japanese label means to cover. The hanging man is a single-line condition whose Japanese label means hanging by the neck.

Editorial reading: keep these labels as visual reminders after the bars have been painted. They do not replace the open-high-low-close skeleton.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
7 of 37 in the Head and shoulders track
19921-12 pp.Next on Head and shouldersA three-count drill that binds candlesticks, head and shoulders, and entry rulesA candlestick signal is treated as valid only after single-candle and multicandle formations have been identified and read against one another.
All readings on this track · 37 readings
  1. 1982Head and shoulders as a three-path completion test
  2. 1984Stock low clusters as a cycle baseline
  3. 1985Four-phase construction of the head-and-shoulders reversal
  4. 1989Volume-confirmed reversal patterns, stops, and measured objectives
  5. 1991The journal as one checklist for taken and skipped trades
  6. 1991Head and shoulders as a direction hypothesis
  7. 1991Candlestick body and shadow construction with three-Buddha peaks
  8. 1992A three-count drill that binds candlesticks, head and shoulders, and entry rules
  9. 1997Constructing bump and run reversal channels
  10. 1998Testing reversal formations in bond futures
  11. 1999Construction first: extra shoulders, the neckline, and the diamond test
  12. 1999Dead-cat bounce, rollover, and failed reversals
  13. 1999Evaluating time gaps in bond reversal patterns
  14. 2000Constructing head and shoulders and double reversal patterns
  15. 2001Constructing broadening and complex bottoms
  16. 2001Constructing a slanted head-and-shoulders when the chart is tilted
  17. 2002Head and shoulders with dominant-cycle timing
  18. 2002Trendline breaks, right shoulders, and trailing stops
  19. 2003Confirmation tests for bearish top patterns
  20. 2003Commodity top hypotheses on a dollar rebound
  21. 2003A head-and-shoulders test during a bear rally
  22. 2004Pattern breakouts need a primary-trend filter
  23. 2004Reading candlestick closes on trendline and neckline tests
  24. 2004Candle diagnosis needs Western targets and stops
  25. 2004Head-and-shoulders neckline construction
  26. 2005A familiar chart condition is a hypothesis, not a completed decision
  27. 2005A 50-day ceiling and a rising-floor stalemate
  28. 2006A complete trading plan from philosophy to checklist
  29. 2006Thin-market head and shoulders with two averages and MACD confirmation
  30. 2010Head and shoulders as a playback-tested setup
  31. 2011Turning a head-and-shoulders outline into a breakout hypothesis
  32. 2011Volume-confirmed head and shoulders on AIG and Citigroup in 2007
  33. 2013Constructing head-and-shoulders milestone points
  34. 2013Head-and-shoulders geometry versus the filter stack
  35. 2013Algorithmic head-and-shoulders construction
  36. 2018International relative strength as a double-top case study
  37. 2019Structure invalidation before comfort-stops
By fieldChart patterns222 readingsBy year199198 readings
All 64 readings tagged Head and shoulders
Also on Head and shoulders5 readings
1992A three-count drill that binds candlesticks, head and shoulders, and entry rules2004Candle diagnosis needs Western targets and stops2004Reading candlestick closes on trendline and neckline tests2005A finished crude-oil top as a classroom for necklines, candles, and gaps2011Evaluating the head-and-shoulders as a falsifiable reversal