1-2-3 trading signals can usually be seen in the beginning and in the end of a trend. You enter the trade after the 1-2-3 signal has been given.
You can see an example of how it might look on the chart here:
Basically the signal consists of different day's high and low prices. The most simple explanation on how you could draw this signal on paper yourself is the following – from the top-left corner draw a diagonal to the center of the page (1), now from that (1) draw a diagonal line towards top-right corner, only end it in the middle of the diagonal (2) and from point (2) draw a diagonal towards bottom-right corner, only end it before you reach the low of point 1 (3). Draw a horizontal line from point 2 and once the same price has been achieved on the chart, wait til it goes just a bit lower and then BUY. Sell signal is exactly the opposite.
The more bars you can see between the signal points, the bigger move you can expect.