Upside Gap Two Crows is a bearish candlestick pattern that signals a potential trend reversal after an upward move, indicating weakening buying pressure
Upside Gap Two Crows: What Is This Bearish Reversal Candlestick Pattern?
The Upside Gap Two Crows is a bearish reversal pattern that shows up in an uptrend. It’s a three-candle sequence that often flags buyer exhaustion and early seller control.
You’re basically seeing price push higher, get rejected, then start rolling back into the gap.
Pattern Structure:
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First Candle: A long bullish (green) candle that keeps the uptrend moving.
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Second Candle: A smaller bearish (red) candle that gaps up above the first candle’s close (no overlap).
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Third Candle: Another bearish candle that opens within the second candle’s body and closes back into the gap between the first and second candle.
The “two crows” are the two bearish candles after that strong green candle. Translation: sellers showed up at higher prices and started leaning on the tape.
Upside Gap Two Crows: Key Characteristics Traders Look For
The pattern only matters if the pieces line up cleanly.
The first candle represents strong bullish momentum—usually a long green body that confirms buyers are still in control going into the setup.
The tell is the second candle: it gaps up (market opens optimistic), but then closes red.
This gap represents the market's initial optimism, but the red close is the rejection. The third candle then adds pressure—opens inside the second candle’s body and closes lower, pushing price down into that gap zone.
The pattern's reliability stems from specific size relationships: the two “crow” candles should look like real selling candles, not tiny doji-style prints.
Also, the gap between candle one and candle two should still be there while the pattern is forming—if it instantly gets filled, the signal gets muddy.
If you’re building an upside gap two crows strategy, volume confirmation often enhances the pattern's significance. Ideally you want to see sellers show up with intent, not just a lazy fade.
It’s a good pattern, but it’s not magic. The context decides whether it’s a clean reversal cue or just a pause in an uptrend.
How to Identify the Upside Gap Two Crows Pattern
To identify the upside gap two crows pattern, you’re looking for a very specific three-candle sequence inside an uptrend.
Candle one should be a strong bullish candle with a real body—buyers in control most of the session.
Candle two must gap higher, then close red. That gap is the key reference.
If price immediately trades back through it and erases the gap, the “gap-and-fade” message weakens.
Candle three opens inside candle two’s body and closes lower, dragging price back into the gap area. The more it presses into the gap, the more you’re seeing the market accept lower prices.
Don’t confuse it with an upside tasuki gap pattern. Tasuki is a continuation vibe. Upside Gap Two Crows is more like: “nice gap… and now nobody wants it.”
How to Spot Upside Gap Two Crows: Step-by-Step Checklist
The cleanest way to spot upside gap two crows is to check the sequence and then sanity-check the context.
Step 1: Confirm the Uptrend Context You want a real uptrend before it prints—higher highs and higher lows, not just one green day. Without trend, the pattern loses its edge.
Step 2: Identify the Gap Opening The second candle needs a clear gap above the first candle’s close (and ideally above its high). In upside gap two crows forex, gaps are less common on many pairs because of near-24h trading, but you can still see “gap-like” jumps around session opens or weekend reopens.
The point is the same: price jumps higher, then gets rejected.
Step 3: Verify the Two Black Bodies Candle two and three both close red. Candle three opens within candle two’s body and finishes lower, pushing back into the gap zone.
Step 4: Check Volume / Participation You want proof the gap-up didn’t bring real buyers. That can be heavier sell volume on the red candles, or weak participation on the gap followed by clear selling.
Either is fine—just don’t ignore the participation side of the move.
Upside Gap Two Crows: Limitations, False Signals, and Risk Management
The upside gap two crows pattern has some real weaknesses. Compared with something like the three black crows pattern (clean, consecutive selling), this one depends on a gap structure that can get distorted fast in thin liquidity, premarket, or headline tape.
Reliability changes with regime. In fast, volatile markets the gap can fill quickly and the whole signal turns into noise.
Around earnings, CPI, FOMC, or major macro headlines, fundamentals can steamroll the candle story.
Volume can also lie. The “perfect” volume read is hard when algos are slicing orders or when you’re looking at instruments where volume is fragmented.
Treat volume as supporting evidence, not a checkbox.
Risk management is the main game. If price rips back above the gap area and holds, the bearish idea is probably wrong and you need a defined stop.
Also, it’s not a super frequent pattern, so backtests can be thin and sample size can mislead.
Bottom line: it’s a useful warning flag, especially at resistance after an extended run, but it trades best with confirmation—not as an automatic short trigger.
Is Upside Gap Two Crows a Reliable Bearish Reversal Signal?
Most textbooks treat the upside gap two crows meaning as a high-confidence bearish reversal—spot it, short it, expect a drop.
In live markets, it’s not that simple. The thinkorswim Learning Center points out the hit rate swings a lot with timing and environment.
Plenty of times it just marks a short consolidation or a quick pullback, then the uptrend keeps grinding higher.
This is where traders get paid for thinking. In a strong bull run, the pattern often turns into a dip-buying opportunity for the market, not a trend change.
On the other hand, if it prints into stretched price, frothy sentiment, or a major level, it can be the first crack in the move.
So the pattern still has value—it just needs to be read with the bigger picture, not traded like a standalone “sell now” stamp.
When Does Upside Gap Two Crows Work Best?
The upside gap two crows pattern tends to work best after a long, extended push where buyers are getting a little too comfortable. CentralCharts notes it’s most effective when the trend is mature and momentum is starting to look stretched.
Location matters. The pattern is more meaningful near a prior swing high, a weekly resistance shelf, a big round number, or after a strong multi-day run where RSI is already overheated.
On volume, watch the story rather than a rule. Some traders want to see heavier volume on the red candles (real distribution). Others look for the gap-up to happen on weak participation, then sellers step in.
Either way, you want evidence that the gap higher didn’t attract sustained demand.
Where it tends to fail: chop, ranges, and headline-driven volatility. The pattern's effectiveness diminishes considerably in ranging markets, because gaps and quick fades happen all the time without any real trend change.
In those conditions, extra confirmation isn’t optional.
How Do You Turn an Upside Gap Two Crows Read Into Better Execution Over Time?
Because Upside Gap Two Crows depends so much on context—trend maturity, location, participation, and whether the gap holds—your edge usually comes from reviewing how your trades behaved after the pattern appeared, not from memorizing the textbook definition. Logging each setup (trend conditions, gap size, volume read, entry trigger, stop placement, and what happened when the gap started filling) lets you separate clean reversals from the common “pullback then continuation” outcomes. Over a meaningful sample, you can track metrics like win rate by market regime, average adverse excursion when the gap fails, and whether waiting for confirmation improves PnL consistency. Using a dedicated journal also makes it easier to spot decision errors—chasing late, ignoring liquidity, or widening stops. A structured tool like Rizetrade trading journal analytics dashboard for trade tracking and performance metrics helps keep those notes, screenshots, and statistics organized so the pattern becomes a repeatable decision process rather than a one-off signal.