Piercing Line Candle Pattern

Piercing Line Bullish Candlestick Setups

A Piercing Line Candle Pattern & Dark Cloud Cover Candlestick Setup look alike but the difference is that one occurs at the top of a Trading up trend (Cloud Cover) and the other occurs at the bottom of a downwards trend (Piercing).

Upward Trend Reversal - Dark Cloud Cover Candles

Downward Trend Reversal - Piercing Line Candles

Piercing Line Candlestick

Piercing line is a long black body followed by a long white body candle.

The white body pierces the mid point of the prior black body.

This is a bullish reversal pattern that forms at the bottom of a market downward stock trend. It shows that the market opens lower & closes above the midpoint of the black body.

This displays that the momentum of the down trend is reducing and market trend is likely to reverse and move in an up-ward direction.

This pattern is shown known as a piercing line signifying the market is piercing the bottom showing a market floor for the price downwards trend.

Piercing Line Candle

Technical Analysis Piercing Line Candlestick

A buy signal is confirmed once price closes above the neck line - the neck line is the opening of the candle to the left of the Piercing Line candlestick.

This is a bullish setup and price should continue moving upward & for one who puts a buy trade should also place a stop loss order just below the lowest price area.

Dark Cloud Cover Candlestick

Opposite of piercing candle.

This candle-stick is a long white body followed by a long black body.

The black body pierces the midpoint of the prior white body.

This is a bearish reversal pattern which forms at the top of an up-wards trend.

It shows that the market opens higher & closes below the midpoint of the white body.

This displays that the momentum of the up trend is reducing and market trend is likely to reverse and move in a downwards direction.

This pattern is shown known as a cloud cover signifying the cloud as a ceiling for the price upward trend.

Dark Cloud Cover Candlestick

Technical Analysis Dark Cloud Cover Candle

A sell signal is confirmed once price closes below neckline which is the opening of the candle on the left of this candlestick.

This is a bearish setup and price should continue moving downwards & for one who puts a sell trade should also put a stop-loss just above the highest price area.