Definition: Get the highest rated stock from Americanbulls for this pattern >>>
We sometimes see that market gaps sharply lower when
it opens and then closes at the same level as the prior
session’s close. This is seen following a black
candlestick in a downtrend. Such an occurrence is called
Bullish Meeting Lines Pattern that is a pattern reflecting
a stalemate between bulls and bears.
Recognition Criteria:
1. Market is characterized by downtrend.
2. We see a black candlestick on the first day.
3. Then we see a long white candlestick on the second
day. Its body is lower than the previous trend.
4. The closing prices are same or almost same on both
days.
5. Both candlesticks are long but the second candlestick
may be shorter than the first.
Explanation:
This pattern appears during a decline. The first candlestick
of this pattern is long and black. However the next
session opens sharply lower causing the bears to feel
confident. Then the bulls start a counterattack pushing
the prices up and leading to a close equal to previous
close. The downtrend is now breached.
Important Factors:
The Bullish Meeting Lines Pattern is a pattern that
is comparable to the Bullish Piercing Line Pattern.
The Piercing Line has the same two-candlestick pattern.
The main difference between the two is the fact that
the bullish counterattack does not carry the prices
up to the prior session’s white real body in the
case of Bullish Meeting Lines Pattern. It can only get
back to prior session’s close while The Piercing
Line Pattern’s second line pushes well into the
black real body. Consequently the Piercing Line Pattern
is a more significant bottom reversal. Nonetheless,
the Bullish Meeting Lines Pattern should also be respected.
The Bullish Meeting Lines Pattern requires confirmation
of the reversal on the third day. This confirmation
may be in the form of a white candlestick, a large gap
up or a higher close on the third day.
