Piercing Pattern
A two-candle formation in which a rising candle opens below the prior falling candle's close and closes above its midpoint.
How it is identified
Test: previous candle falls; current Open < previous Low; current Close > midpoint of previous body but below its Open
Unit
qualitative
In depth
The piercing pattern mirrors dark cloud cover and is a partial bullish engulfing — the second candle recovers more than half the first but not all of it. Both conditions matter: opening below the prior low requires a downward gap, and closing above the midpoint is what separates the pattern from an ordinary bounce. Because it needs a gap, it is more common on daily charts than intraday. The entry defines the formation without predicting an outcome.
Worked example
Candle 1 falls from ₹528 to ₹494, midpoint ₹511. Candle 2 opens at ₹490, below the prior low, and closes at ₹516 — above the midpoint and below the ₹528 open, satisfying both conditions.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Piercing Pattern” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.