Piercing Line
A two-candle bullish reversal where a green candle gaps down then closes back above the midpoint of the prior red candle.
A piercing line forms after a decline: a strong red candle is followed by a green candle that opens with a gap down below the prior low, then rallies to close above the halfway point of the red candle's body. Buyers reclaimed most of the prior day's loss.
The deeper the green candle closes into the red body, the stronger the signal — if it closes all the way above the red open, it becomes a bullish engulfing. It's the bullish counterpart of dark cloud cover.
On StockSetups
StockSetups recognizes piercing lines among its bullish candlestick confirmations, strengthening a setup when one appears at support.
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