Direct Answer
The upside gap two crows is a three-bar pattern that appears after an uptrend. It gets its name from the gap that opens after the first bar and the two bearish "crow" candles that follow it.
Key Takeaways
- An upside gap two crows is a three-bar bearish reversal pattern that appears after an uptrend.
- The first bar is a long bullish candle; the second gaps up and is a small bearish candle; the third gaps up further still but reverses to close bearish, engulfing the second bar's body.
- The third bar closes back within the original gap but does not fully fill it, the gap stays technically open even as the pattern completes.
- Two consecutive bearish bars after the initial gap-up are read as a meaningful bearish warning, despite the unfilled gap.
- Confirmation typically means the next bar closes below the third bar's low.
Upside Gap Two Crows Candlestick Pattern: Formation, Meaning, and Signals
The upside gap two crows is a three-bar bearish reversal pattern that forms after an uptrend, when a long bullish candle is followed by two bearish candles that gap up but fail to hold, with the third engulfing the second. The gap stays only partially closed, but the shift from buying to two straight bearish bars is treated as a bearish warning.
What Is an Upside Gap Two Crows?
The upside gap two crows is a three-bar pattern that appears after an uptrend. It gets its name from the gap that opens after the first bar and the two bearish "crow" candles that follow it. The pattern signals that an uptrend may be losing momentum: after a strong bullish push, two consecutive bars fail to sustain new highs and close bearish instead.
What separates it from a looser bearish setup is the specific relationship between the second and third bars: the third bar's bearish body must engulf the second bar's bearish body, while both bars remain gapped above the first bar's close. That combination, a gap up followed by two engulfing bearish bodies, is what defines the pattern rather than any single bar in isolation.
How an Upside Gap Two Crows Forms
The pattern forms in three bars. The first bar is a long bullish candle, consistent with the uptrend it appears in. The second bar gaps up from the first bar's close and is a small bearish candle, buyers pushed price to a new gap-up open, but sellers took control before the close. The third bar gaps up further still, extending the gap even higher, but reverses to close as a bearish candle that engulfs the second bar's body entirely.
Despite the third bar's bearish engulfing move, it closes back within the original gap between the first and second bars, but it does not fully fill that gap. The gap between the first bar's close and the second bar's open remains partially open even after the pattern completes, which is a defining feature of this pattern rather than a flaw in it.
Upside Gap Two Crows Example
The chart below shows a deterministic, illustrative example: an uptrend leading in, the three-bar upside gap two crows pattern forming, then two possible continuations, a confirmation (price follows through lower) and a failure/look-alike (price recovers instead). Toggle between them to see why the pattern alone doesn't decide the outcome.
How to Trade an Upside Gap Two Crows
Weigh the unfilled gap correctly
Despite the gap remaining technically unfilled, the reversal shown by two consecutive bearish bars after the initial gap-up is read as a meaningful bearish warning. Traders who wait for the gap to close completely before acting are applying a stricter rule than the pattern itself requires.
Wait for confirmation
Confirmation typically means the next bar closes below the third bar's low. Until that happens, the pattern is a warning that buying momentum has stalled, not a confirmed reversal in progress.
Read it against the uptrend
Because the pattern only has meaning after an uptrend, the same three-bar shape appearing without a preceding uptrend doesn't carry the same bearish implication. Location within the broader trend is part of what makes the pattern actionable.
Common Upside Gap Two Crows Mistakes
- Confusing it with the plain two crows pattern, the looser two crows concept doesn't require the third bar to specifically engulf the second bar's body.
- Assuming the gap must be fully filled, the pattern specifically requires the gap to stay only partially closed, not fully filled.
- Skipping confirmation, acting on the pattern before the next bar closes below the third bar's low treats a warning sign as a confirmed reversal.
- Ignoring the preceding uptrend, the same three-bar shape without a prior uptrend doesn't carry the same bearish reversal implication.
Upside Gap Two Crows vs. Similar Patterns
| Pattern | Bar structure | Key difference from an upside gap two crows |
|---|---|---|
| Upside Gap Two Crows | 3 bars | Baseline, third bar specifically engulfs the second, gap stays partially open |
| Two Crows | 2+ bars | Looser two-bearish-bar concept without the strict engulf requirement |
| Evening Star | 3 bars | Middle bar is a small-bodied star rather than two full bearish bodies |
Limitations of the Upside Gap Two Crows Pattern
The upside gap two crows describes a specific three-bar shape, not a forecast. It carries no information about volume, order flow, or why buyers failed to hold the gap-up opens, a pattern caused by a scheduled news release behaves differently from one that formed on ordinary trading. It also says nothing about how far a reversal might extend, since the gap staying unfilled means upward pressure hasn't fully disappeared. Like any multi-bar pattern, it works best combined with trend context and a defined confirmation plan, not used alone.
Back Into the Gap, But Not Through It
The condition that defines this pattern is easy to state and easy to miss: the third bar closes back inside the original gap without closing below it. That precise placement is the pattern. A third bar that closes above the gap has not done enough; one that closes clean below it has produced a different and arguably stronger situation, and neither is this pattern.
So marking the gap boundaries when the second bar prints is the practical step. The third bar then answers the question against a level you already have rather than against an impression of how far it fell.
The reading that follows is a specific kind of failure: two attempts to hold higher ground, both given back, with the market ending inside the void it had gapped across. That is a more detailed story than most three-bar patterns tell, and it depends entirely on the placement being checked.
Two gaps in three bars make this scarce outside session-based markets, and as with every reversal pattern here, an established advance has to precede it for there to be anything to reverse.
Upside Gap Two Crows FAQs
Is the upside gap two crows always a reversal signal?
No. The pattern describes a specific three-bar shape after an uptrend, a long bullish bar, then two gapped-up bearish bars with the third engulfing the second. Whether it turns into an actual reversal depends on what the next bar does, not the pattern alone.
Does the gap in an upside gap two crows need to be filled?
No. By definition the third bar closes back within the original gap but does not fully fill it. A trader waiting for the gap to close completely before acting is applying a rule the pattern doesn't require.
What's the difference between the upside gap two crows and the plain two crows pattern?
Two crows is a looser concept describing two consecutive bearish candles after a gap up, without a strict requirement on how they relate to each other. The upside gap two crows specifically requires the third bar's body to engulf the second bar's body.
How is the upside gap two crows different from an evening star?
An evening star's middle bar is a small-bodied candle representing a pause, flanked by a bullish bar and a bearish bar. The upside gap two crows instead has two consecutive full bearish bodies after the initial bullish bar, with the second and third bars gapping up rather than pausing.
What confirms an upside gap two crows signal?
Confirmation typically means the next bar closes below the third bar's low, following through on the bearish reversal the two consecutive bearish bars already suggested.
Which of the two crows engulfs the other?
The second engulfs the first. Both are bearish candles above the first bar close, and the second must open higher than the first crow and close below it, covering its body. That relationship is what distinguishes the pattern from two ordinary down bars after a gap, and it is the condition implementations most often omit.
Does the second crow have to close above the first candle close?
Yes, in the standard definition, which means the gap is only partly filled. If the second crow closed below the first candle close, the gap would be closed entirely and the pattern would become a straightforward reversal rather than the specific structure described. That partial fill is the distinguishing feature and is easy to lose in implementation.
How is this different from a simple failed gap?
A failed gap is any gap that gets filled or rejected, which is a broad category. Upside gap two crows specifies three bars, two of which must be bearish with an engulfing relationship, and it requires the gap to remain partly open. The candlestick pattern is a narrow instance of the general behaviour, and most failed gaps do not satisfy it.
How common is this compared with the plain two crows?
Rarer, because it adds the gap requirement on top of the two-bar relationship. The plain version needs only the second candle opening above the previous close, which is a much weaker condition. Any comparison of the two patterns behaviour has to account for the difference in sample size that the extra condition produces.
References
- CMT Association: Technical Analysis Body of Knowledge and Research
- CFA Institute Research and Policy Center: Investment Research
- Steve Nison, Japanese Candlestick Charting Techniques (1991), the book credited with popularizing Japanese candlestick analysis in Western markets.
- SEC Investor.gov: Introduction to Investing