It appears that what it means here is it would delay the alert only.
i.e Once condition fulfilled in 1st period, alert would be raised at 4th period(doesn't matter during 2nd and 3rd period if the condition is fulfilled or not)
I want to configure in such a way that only rause alert if it happens CONSECUTIVELY for 3 period. How can I achieve this?
Alert propagation characteristics specify how the alert is triggered and canceled. By default, an alert is raised after one monitoring interval during which the triggering conditions are fulfilled. In most cases the default settings will be sufficient, but you can modify them as needed.
Just review the below link for the alert propagation settings.
I can confirm that your setting are correct i.e. "Raise after 3 intervals" alert mechanism will check if the condition remains true for 3 consecutive period. Then at start of 4th period, alert will be generated.
Hope this helps you.