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The piercing pattern is a bullish candlestick revenue pattern, similar to the Bullish engulfing pattern bullish engulfing pattern
Conditions
Current body should cover 50% of previous day body
BUY=> When it is bullish reversal
SELL=> When it is bearish reversal
The piercing pattern is a bullish candlestick reversal pattern, similar to the bullish engulfing pattern of bullish engulfing pattern
With fall in price today Body should Cover 50% of Previous Body with Increase in volume and up per tail should not be very high. buy- latest two day High Sell – latest two day Low
Piercing pattern is not continuous trend pattern. It is trend reversal pattern. If you see it in the bottom you can expect a positive move is gonna take place.
Conditions to qualify Piercing pattern: (1) the bull body covers the previous day candlestick’s lower side..usually opens with gap down (2) the bull body should cover at least 50% of the previous candle and (3) the upper tail should be shorter. It means if it is longer upper tail, we can assess it as lot of selling pressure. With shorter upper tail we can logic that bulls may had not enough time to cover the previous full body, if bull could have time it would cover the whole body of previous day’s candle.
Buy – higher of last two days price
stop loss – lower of last two days price
expected sell price – buy price plus (or more than that sum) difference between buy price and stop loss price
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