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piercing patterns are reversal patterns
Bullish piercing line criteria
1. The market should be in prevailing downtrend
2.A black candlestick appears on the first day
3. A white candlestick opens on the second day with gap down and closes more than halfway into the body of the first day. upper tail should not be big
4. the second day fails to close above the body of first day
Short position can be covered above the high of second days white candle
A long trade can be entered a<span style=”line-height: 24px;”>bove the high of second days white candle</span>
<p style=”margin: 10px 0px 30px; color: #000000; font-family: Arial, Helvetica, sans-serif; line-height: 28px; word-spacing: 1px;”></p>Piercing pattern is also a reverse trend pattern. After a recent price fall the day opening should be lower than the prev day low.
The body should be able to cover atleast 50% of prev day body then it indicates bullish piercing pattern.
Buy when it crosses prev day high.
Sell when there is a bearish piercing pattern.
buy
in a bear trend when the latest green body covers 50% of prev red body
sell
in a bull trend the latest red body covers 50% of prev green body
conditions for piercing the latest reversal pattern should cover more than 50% of prev body. the previos low should be within the current body
AFTER A CONTINIOUS RAISE OR FALL THE CANDLE HAS COVERED THE PEVIOS DAYS LOW AND COVER HALF THE CANDLE, WITH SMALL OR NO UPPER TAIL. THEN ITS PIERCING PARTTERN. S AGAIN WITH VOLUME.
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Open Sans’; font-size: 13px; line-height: 20px;”>Piercing pattern is also a reverse trend pattern. After a recent price fall the day opening should be lower than the prev day low.</p>
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Open Sans’; font-size: 13px; line-height: 20px;”>The body should be able to cover atleast 50% of prev day body then it indicates bullish piercing pattern.</p>
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Open Sans’; font-size: 13px; line-height: 20px;”>Buy when it crosses prev day high.</p>
<p style=”box-sizing: border-box; margin: 0.85em 0px; direction: ltr; color: #777777; font-family: ‘Open Sans’; font-size: 13px; line-height: 20px;”>Sell when there is a bearish piercing pattern.</p>
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