A strong bearish candle followed by a bullish candle that opens lower but closes above the midpoint of the prior body. Buyers recover more than half of the selling.
How to identify it
- First candle is a solid bearish bar in a decline
- Second opens at or below the prior close
- Second closes above the midpoint of the first body but not above its open
Entry
Buy above the high of the piercing candle.
Stop loss
Below the low of the second candle.
Target
The open of the first candle, then the next resistance.
Invalidation
A close back below the midpoint of the first body.
Does it work for you?
Textbook reliability means little until you know your own numbers. Tag your piercing line trades in TradeZento and it shows your win rate, average win and loss, and P&L per trade for this pattern, so you know whether to keep it in your playbook.