Continuation: windows and three methods
- Gaps as support and resistance
- Rising and falling three methods
- Why true gaps are rare in crypto
Windows
The Japanese call a gap between candles a window. A window in the direction of the trend tends to act as support (uptrend) or resistance (downtrend) when price comes back to it; a close back through the whole window cancels that.
Rising and falling three methods
A long candle in the trend's direction, then a few (classically three) small candles drifting against it but staying inside its range, then another long candle to a new extreme. It is a rest within a trend — the same idea as a flag in Western terms.
Crypto note
Perpetual futures trade 24/7, so true gaps are rare (they happen after outages, and on stock and commodity perpetuals around their real-world sessions). The same idea applies to very fast candles that leave a thin, untraded area — often called an imbalance or fair-value gap.
Check yourself
1. In an uptrend, a window (gap up) is left behind. When price returns to it, it often acts as…
- Resistance
- Support ✓
- Nothing
2. Rising three methods is…
- A reversal
- A pause within an uptrend ✓
- A gap
Terms in this lesson
- Rising / falling three methods
- A rest of small counter-candles inside a big trend candle, then continuation.
- Window
- Japanese term for a price gap.