3 Day Cycle Series

Part 1: 3 Day Cycle

Pips2Profit
Cameron Benson
Step 1: Find the beginning of a new 3 Day Cycle (3DC)
A new 3 day cycle can be observed when
there is a failed breakout of a previous
days high/low at either the high or low of
a CURRENT week.

Example:

1. Monday breaks Fridays high and

closes back inside Fridays range=Day
1
2. Tuesday breaks Mondays low OR
high and closes back inside
Mondays range.
3. Wednesday, Thursday or Friday- At
either the high or low of the
CURRENT week, market breaks out
of a previous days level and closes
back inside of the previous days
range.

*These behaviors are observed on the 15M

timeframe.
 Day 1 Examples
1. Tuesday
creates a high
and low of the
current week.
2. Wednesday
attempts to go
higher and
FAILS at the
high of
CURRENT
week.
3. This creates
Wednesday as
Day 1 of 3 Day
Cycle.

The above image displays a failed breakout at the current high of week (HOW), restarting the 3 day cycle.
Finding Day 1 Continued: Failed Breakout Over 2 Days
Failed Breakout over 2
Days:
1. Mondays breaks
Fridays low
2. Tuesday closes
above Fridays low,
back inside of
Mondays range.
3. Monday becomes
days 1 after the
close of Tuesday.
4. Tuesday becomes
day 2 at the close
of Tuesday.
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The above image displays a failed breakout over the course of 2 days, restarting the 3DC
 Finding Day 1 Continued: Trending Markets
There will oftentimes be a failed 3
day cycle that breaks out and
begins to trend. This in itself is
valuable information.

1. Find the last place the

market started a 3 day cycle
(failed breakout from current
HOW/LOW.
2. Market breaks out and
continues to trend and DOES
NOT provide another failed
breakout (continues to
trend.)
3. Day 3: Does not provide a
failed breakout. This day, at
the close of the day, will
become day 1 of the 3 day
USDJPY 1H Chart - Displays the rotation of 3DC in a trending market.
cycle.
 Odd Variations And Questions
Q: Can a Day 2 become a Day 1?

A: Yes. As long as there was a failed breakout at

the high or low of the CURRENT week.

Q: What if the market keeps breaking out and

failed over and over again?

A: This is a sign of a large trade setup forming for

either a HOW or LOW reversal (I.E 3 days of
breakouts).

Q: What if the market breaks out at the HOW

one day (and fails), and on the following day
breaks out of the LOW and fails AGAIN?

A: I not ignore the 3 day cycle. There is a large

weekly template at play. This scenario could lead
to a large parabolic move on the following day.
(Peak formation high, peak formation low,
consolidation in the middle). This could lead to a
Above image: Showing the market resetting the 3DC multiple days in a row
strong heartbeat pattern trade or a short giving valuable information for the near future (within the next couple of days).
squeeze/long squeeze setup.
 Defining failed breakout
1. On the 15M chart,
candles CLOSED
above or below a
previous days level.
NOT A PIN, BODY
OF CANDLE BROKE
THE LEVEL AND
CLOSED.
2. Market pulls back
inside of the
previous days range.
3. Market ends the
day and CLOSES
INSIDE of the
previous days range.

The above image identifies the properties of a failed breakout.

 Day 3 falls on an inside day
Day 3 on an inside day will PAUSE the cycle.

Example: Day 1 and 2 play out as normal. Day 3

begins to print candles, but does NOT hit previous
days high or low (definition of inside day or inside
bar on the daily chart).

The following day will now repeat day 3 of the 3

day cycle

Above Image: Day 3 as an inside day. Day 3 must repeat on the

following day.
 Next Video:
Step 2 - Identify the 3 day cycle templates and
associated setup.
References:
1. Stacey Burke YouTube Channel
2. Steve Mauro - Beat the Market Maker (BTMM)
3. Taylor Trading Technique - George Douglas Taylor (published 1950)
4. My own due diligence, experience, studies and ability to create a process for myself to trade these setups effectively,
and to create the rules for objectively identifying Day 1.