The piercing line is a trend reversal candlestick pattern. Which signals the end of the established downtrend and the beginning of the upward momentum.
This pattern consists of a candle with a long red downward moment on the first day and the next day the green bullish candle is ready.
The price opens very low on the second day and rises slightly above the center of the candle on the first day.
As you can see in the chart, a red candle is formed following the downward momentum or the downtrend.
The next day the price opens further down following the downtrend but on that day the price improves and it closes at the middle level of the first day's candle.
This is a sign that the bears are getting weaker and the bulls are getting stronger.
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