💹 Piercing Line Candlestick Pattern – Bullish Reversal Signal

The Piercing Line is a two-candle bullish reversal pattern that forms after a downtrend. It signals that buyers are returning and the trend may shift from bearish to bullish.

📘 What Is the Piercing Line Pattern?

The Piercing Line is a two-candle bullish reversal pattern. The first candle is long and bearish, showing strong selling pressure. The second candle opens below the first candle’s low but closes above the midpoint of the first candle, signaling a shift toward bullish sentiment.

• Occurs after a downtrend or bearish market.
• First candle is a long red bearish candle.
• Second candle opens lower, closes above the midpoint of the first candle.
• Indicates buyers are taking control and a potential trend reversal.
  
  
  

💡 Market Psychology

The first long red candle shows strong selling, but the second candle demonstrates that buyers are returning. Closing above the midpoint of the first candle signals that bulls may take control and the trend could reverse upwards.

✅ Pro Tip: The Piercing Line is stronger if it forms near a support zone and is accompanied by increasing volume.

⚙️ How to Trade the Piercing Line Pattern

1. Identify the pattern after a clear downtrend.
2. Ensure the second candle closes above 50% of the first bearish candle.
3. Enter a buy (long) position at the close of the second candle.
4. Place a stop-loss below the low of the second candle.
5. Set your target at the next resistance level or based on a 1:2–1:3 risk/reward ratio.
   
   
   

🏁 Conclusion

The Piercing Line candlestick pattern is a strong indicator of bullish reversal. When combined with volume, support zones, and other technical indicators, it can provide traders with reliable entry points for a long trade.

“When the Piercing Line forms — the bulls pierce the darkness, and an uptrend begins.”