Piercing pattern occurs when a body of a candle completely covers the lower part and grows up to 50% of the previous opponent candle, but fails to cover it completely. If piercing occurs with a good volume, then it signals a reverse trend. The difference between the top and the bottom (wick and tail)of the piercing candle is calculated. For a bullish pattern, entry should be placed on or above the wick of the piercing candle and stop loss on the end of its tail. Target should be 1.5 or 2 times the difference. Here the target is set twice the difference.
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Stock Analysis
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Bullish View
Bearish View
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Hi,
Your point of view is right
The green body doesn’t cover the previous day low of the red body. Can I classify this as bullish piercing?
Thank you for the feedback.
The tail of the green candle extends as long as the tail of the red candle. So I considered that as a piercing.
The arrows and the rectangle are blocking the view.
I don’t think that Piercing is considered only when:
The body of the second candle, [not its tail] covering the previous candle’s tail.
Even the tail covering the tail can be considered. I’ll be happy if any seniors clear the doubt.
Thank you for your opinion.