How I get the bias
On this day PLTR 0.00%↑ was gapping up above previous range
On the 60-min chart it showed nice sideways consolidation
Entry rules
For a 3BAR play we need a bias, a space for the break-out continuation and a pattern.
1st bar from a 3BAR play has to be a range expansion bar shooting out of a range, breaking previous resistance with a volume. The 1st bar has to be the biggest bar there so far
2nd bar has to be a low volume resting bar, ideally but not necessarily a hammer.
The entry signal is the break of the high of the previous 2 bars or more aggressive entry is a break of the previous resting bar. After the entry, an explosion higher is expected. In this case it was a break of pre-market high which also possibly triggered some stop, and continued higher. At the same time the trade was a 5-min ORB, so more traders jumped in to play that break.
Trade management
For 3BAR plays, usually good target is 2R which is where I bailed after the stock nearly reached 3R and started to look like a reversal. Eventually, a longer hold would reach 3R, but I do not like to hold the break-out patterns for such a long time.