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PipsGrowth

Key Takeaways

Success Rate:60%
Difficulty:Intermediate
Strength:
R:R Ratio:1:2
⬆️

Piercing Line

bullish reversalHigh Reliability2 Candles

A two-candle bullish reversal pattern where the second candle opens below the first candle low but closes above the midpoint of the first candle.

Market Psychology

Despite opening lower, buyers aggressively pushed prices up, recovering more than half of the previous losses.

Candle Structure

1st2nd

Trading Setup Example

Entry, stop loss, and take profit levels.

How to Trade the Piercing Line PatternTake Profit📥 EntryStop LossPatternConfirmEnterBUYPatternConfirmEnterSL/TP

Always wait for pattern confirmation before entering a trade.

Where This Pattern Appears

Trend context and market position.

DowntrendPiercing LineReversal ↑

Appears at the bottom of a downtrend, signals bullish reversal.

How to Identify

1

First candle is a long bearish candle

2

Second candle opens below the first candle low (gap down)

3

Second candle closes above the midpoint of the first candle body

4

Appears after a downtrend

Confirmation Signals

RSI oversold (<30)
At key support level
Volume increase
Bullish next candle

Trading Strategy

📥 Entry

Enter long on close of second candle or break above second candle high

🛑 Stop Loss

Place stop below the pattern low

🎯 Take Profit

Target previous resistance levels

⚖️ Risk/Reward

1:2

Common Mistakes to Avoid

Trading without prior downtrend
Not waiting for confirmation
Ignoring volume
Setting stop too tight

Pro Tips

💡The deeper the penetration into first candle, the stronger the signal
💡Gap down opening adds significance
💡Works best on higher timeframes

Best Timeframes

4HDaily

Pattern Variations

At support level (stronger)
With gap open
آخر تحديث: ٢٩ ديسمبر ٢٠٢٤

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Frequently Asked Questions