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October 22, 2026FrançaisEspañol

Three-bar reversal: what it is, and how to test it

A three-bar reversal up is a small turn: the middle bar makes a lower low than the bars on each side, and the third bar closes above the middle bar's high. The reversal down is the mirror image. Here is the exact rule QuantLogic uses.

Middle bar's highReversal
The level the idea readsThe bar where the idea firesA drawn example, not market data.

What it is

It is the smallest swing low there is: one bar lower than its neighbours on both sides.

The close above the middle bar's high is what turns the low into a reversal.

The exact rule QuantLogic uses

Three-bar reversal up, on one-minute bars. The reversal down is the mirror image.

  1. The bar before has a lower low than the bar two bars ago and a lower low than this bar.
  2. This bar closes above the bar before's high.

When is it known? Known when the third bar closes.

Versions you can build

  • Three-bar reversal up. Lowest low in the middle, close above its high.
  • Three-bar reversal down. Highest high in the middle, close below its low.

What to look at around it

In QuantLogic, every time the idea happened is laid out with the data points around it, so you can see where it held and where it didn't:

Time of day and sessionEconomic calendar and newsVWAP distanceGamma regime, flip and wallsYesterday's value area and pivotsVolatilityNQ vs ES since the openUp or down on the day

Traps when you test it

  • Mistaking it for a swing. The swings QuantLogic uses for structure need 3 bars on each side; this needs only one.
  • Counting it everywhere. On one-minute bars it is frequent; the context usually separates them.
  • Testing only the up side. Check the reversals down too.

Build it and test it yourself

Open Three-bar reversal up in Build with QuantLogic. See every time it happened on NQ, ES, Gold or Crude since September 2025, check the long and the short side, add your own filters and run the luck test.

Build this setupSee plans

Nothing is proven until it holds live. We give no trading signals and no advice, we never hold your money or your accounts, and we never trade for you.

Questions

Is this the same as a swing low?
It is a one-bar version. Break of structure and change of character use stricter swings of 3 bars each side.
When is it known?
At the close of the third bar. Nothing later is used.

Related setups

Educational content, not investment advice. Futures trading involves substantial risk of loss. See the risk disclosure.