Piercing Line
A piercing line is a two-candle bullish reversal: after a down candle, the next session opens lower but rallies to close above the midpoint of that down candle's body. It is a weaker cousin of the bullish engulfing, because the recovery is partial rather than complete.
- Bias
- Bullish
- Category
- Candlestick Reversal
- Scan cadence
- Every close
What has to be true for a Piercing Line to trigger
- A down candle followed by an up candle
- The up candle opening below the prior close
- The up candle closing above the midpoint of the prior body, but not above its open
- A preceding decline
How PatternGrade grades it
A deeper penetration into the prior candle's body raises the grade.
Every scanner grades its hits A+, A or B from the pattern's own measurable structure. The grading is deterministic — the same chart always produces the same grade. It describes how closely the chart matches the pattern, not how likely anything is to happen; no hit rate or probability is attached to a grade. The reasoning is set out in the methodology.
What a Piercing Line looks like in practice
A stock falls to close at $54.30 after opening at $57.10, a wide red body spanning nearly three points. The next session gaps down to open at $53.80, then rallies all day to close at $56.10, which is above the midpoint of the prior candle's body at $55.70. Volume rises about 60% over the previous session and the close lands near the high of the day.
How a Piercing Line fails
The recovery stalls below the prior candle's open. A piercing line that closes only barely past the midpoint has not demonstrated much conviction, and price frequently resumes lower from there. The pattern is a partial reversal by definition, which makes it inherently weaker than a full engulfing. Without follow-through in the next session or two it usually amounts to a one-day bounce.
What this pattern is telling you
By construction this is a partial recovery. If the close clears the prior open it is an engulfing pattern, which is a stronger signal.
PatternGrade is not a financial advisor and does not give buy or sell recommendations. Targets and stops shown on a pattern are reference levels derived from its geometry, not advice.
How to scan for Piercing Line setups
PatternGrade rescans every liquid US stock (~4,500 names) for this pattern after every close and returns the hits as a graded list, with the pattern drawn on each chart, so you review setups rather than hunt for them.
Join the waitlist to be invited when sign-ups reopen and see the current Piercing Line list, or browse all 75 patterns.
Piercing Line FAQ
What is a piercing line pattern?
A two-candle bullish reversal where price opens below the prior session's close and rallies to close above the midpoint of the prior down candle.
What is a piercing line?
A two-candle bullish reversal: a substantial down candle, then a session that opens lower, classically with a gap, and rallies to close above the midpoint of that down candle's real body. The name refers to the second candle piercing back into the first.
How far must the second candle close?
Above the 50% mark of the first candle's real body. Less than that and it is not a piercing line; more, and it approaches a bullish engulfing. The deeper the recovery, the stronger the reading, and PatternGrade grades on that depth.
Does the second candle have to gap down at the open?
Classically yes. In practice, opening gaps on liquid US equities are less common than the Japanese rice-market context the pattern comes from, so most modern implementations accept an open at or below the prior close.
Is a piercing line weaker than bullish engulfing?
Structurally, yes. It recovers part of the prior decline rather than all of it, so it represents less of a shift. Both are two-candle patterns whose value depends far more on where they appear than on the geometry itself.
Patterns a Piercing Line is mistaken for
- Bullish Engulfing
- Engulfing fully covers the prior body. A piercing line only recovers past its midpoint. Same idea, different degree: engulfing is the stronger case.
- Morning Star
- Three candles with an indecision bar between. A piercing line is two consecutive candles.
- Dark Cloud Cover
- The bearish mirror: an up candle followed by a down candle closing below its midpoint.
Last reviewed . Structure and grading for the Piercing Line are reviewed against the scanner's own rules.