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Bullish Piercing pattern - Multiple Candlestick Pattern

Bullish Engulfing and Piercing pattern - II

Piercing bullish 

Piercing Bullish

How to recognize it? 

  • There must be a proceeding downtrend 
  • Red candle followed by a green candle 
  • The green candle opens with a gap down and closes at 50% or above the real body of red candle 

What is the psychology behind? 

  • The red candle implies the control of the bears following a prolonged downtrend 
  • In next session, the market opens below the low of the red candle, suggesting continuation of the bearish forces 
  • The bears then lose momentum, the bulls conquer and lead the price up during the session, and eventually managed to cover 50% losses or more from the previous sessions 


How do we trade it? 

  • Look for the piercing at the bottom of a down Trend 
  • Wait for the next candle to close above the high of the green candle to confirm the existence of bullish force 
  • Open a long position upon confirmation 
  • Place a stop loss below the low of the green candle


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