The Rule of 3 in Trading: A Hidden Technique Every Trader Should Know

It’s Morning, 9:15 AM

The market opens.

Charts start moving.

Candles begin forming stories.

And most retail traders?

They jump in after one candle, one signal, one hint.

That’s where the trouble begins.

Today’s article reveals a hidden trick many experienced traders silently follow…

A trick that protects them from emotional trades, fake breakouts, and unnecessary losses.

It’s called The Rule of 3 in trading.

Let’s break it down in the simplest way.

PROBLEM STATEMENT: Why Most Traders Lose

Most traders lose not because they don’t know technical analysis…

…but because they react too early.

One candle.

One breakout.

One rejection.

One green/red move.

Immediate entry = Immediate regret.

If you’ve ever said,

“Why does the market take my stop–loss and then go in my direction?”

This blog is for you.

This is one of the biggest beginner trading mistakes to avoid, and the Rule of 3 solves it.

MARKET OPENS… NOW WATCH HOW THE RULE OF 3 WORKS

1.Three Tests Before Trust(Support–Resistance Logic)

Before any zone becomes “valid” – support or resistance – the market usually tests it more than once.

Imagine:

Price touches a zone once – okay.

Touches again – interesting.

Touches a third time – Now it’s real.

Why this matters:

A zone tested 3 times becomes stronger.

It tells you the market respects that level.

Example:

Support at Rs . 100:

First touch: Just a random bounce

Second touch: Buyers are interested

Third touch: Buyers are defending strongly – strong chance of upward move

Solution:

Wait for 3 touches before calling something “strong support/resistance.”

2.Three Rejections = Market is Speaking

A “rejection” simply means price tried crossing a level… but the market said, “Not today.”

Three rejections mean the level is powerful -this is a classic market rejection pattern.

Example:

Price tries to break Rs 120 THREE times:

This tells you big players are not letting it cross.

Solution:

Avoid buying into a level that has already rejected price three times.

It’s like running into a locked door again and again.

3. Three Times the Market Will Trick You

(Here’s the twist no one tells you.)

The market LOVES to fool impatient traders.

Three classic traps:

Trap 1: Fake Breakout Candle

Price breaks out – you buy – next candle reverses.

Classic retail trap.

Trap 2: Sudden Stop–Loss Hunt

Price comes near your SL – touches it – reverses strongly.

Why?

The market needed liquidity.

Trap 3: Emotional Candle – Big Green/Red to Tempt You

The candle looks powerful.

But it often forms exactly in the wrong area.

Solution:

If something looks “too perfect,” stay calm.

Let the market show real confirmation, not emotional bait.

4. Three Confirmation Candles – The Real Entry Signal

Most traders enter on the first candle that breaks a level.

Smart traders wait for three.

Why?

Because the first candle is usually a trap, the second is a test, the third is the truth.

Example:

A breakout above resistance:

Candle 1 – Breaks out

Candle 2 – Tests the level

Candle 3 – Closes strongly – now it’s real

Solution:

Wait for 3 candles to confirm any breakout or breakdown.

This filters most bad entries and helps you confirm breakouts with confidence.

THE SIMPLE SUMMARY

• 3 tests – level becomes REAL

• 3 rejections – don’t force entries

• 3 traps – the market will try to fool you

• 3 confirmation candles – safer entry zone

If every beginner follows these, half the losses disappear.

WHERE DO TRADERS GO WRONG?

They want

1. Instant results.

2. Instant entries.

3. Instant profits.

But the market rewards discipline, not speed.

The Rule of 3 forces you to slow down and WAIT.

• When you wait, you get clarity.

• When you have clarity, you avoid traps.

• When you avoid traps, you protect capital.

And capital protection is what creates long–term traders.

HOW GOPOCKET HELPS HERE

GoPocket’s team trains thousands of traders with simple, practical concepts like this.

Whether you're studying price action trading basics, analysing charts, avoiding fake breakouts, or learning market rejection patterns, GoPocket helps you:

• Learn in multiple languages

• Avoid common beginner traps

• Get clarity on price action

• Build confidence step by step

• Trade with awareness, not fear

When your learning is systematic, your trading becomes stronger.

FINAL THOUGHTS

The next time the market opens, remember this:

• Don’t believe the first move.

• Watch the second.

• Trust the third.

That’s the Rule of 3.

The market always tells the truth –

You just need to wait long enough to hear it.

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