Why the Piercing Line Failed to Reverse the Trend?
Why the Piercing Line Failed to Reverse the Trend?
A Piercing Line pattern is a bullish reversal signal that appears after a downtrend. However, this pattern failed to reverse the bearish trend in today’s price action due to the following key reasons:
1. Lack of Follow-Through Buying
• A strong Piercing Line requires the next candle to be bullish, closing above the previous day’s high, confirming a shift in momentum.
• Instead, today’s candle is a strong bearish engulfing bar, completely wiping out the bullish intent. This shows sellers overpowered buyers immediately.
2. Rejection at Key Resistance (Supply Zone)
• The price attempted to push higher but got rejected at 2,956-2,972 (VWAP Upper Band & VSA Resistance).
• Liquidity absorption at this level suggests smart money selling into strength, not accumulation.
3. Weak Volume Confirmation
• A strong Piercing Line should come with increasing volume, indicating strong buying pressure.
• Volume was weak (-5.8%), meaning there was no real commitment from buyers.
• A spread increase (+74.95%) without volume support suggests a liquidity grab rather than true demand.
4. Order Flow Shows More Aggressive Selling
• Delta is negative, indicating more market sells than buys.
• The footprint chart shows large sell orders dominating, meaning big players are still offloading.
5. Bearish Momentum Dominates Lower Timeframes
• 1H, 4H, and 8H charts show bearish continuation patterns with price breaking key VWAP levels.
• No higher highs or strong demand zones were created, meaning bulls are not defending.
Conclusion: No Bullish Confirmation → Bearish Continuation
A Piercing Line is only valid if buyers sustain momentum. Since today’s session completely erased the bullish signal, this is a failed reversal and more downside is expected.
Trade Plan (Bearish Bias)
• Sell Below: 2,891
• Stop Loss: 2,920
• Target 1: 2,863
• Target 2: 2,850-2,810
👉 Key Takeaway: Price action alone is not enough. Volume, order flow, and momentum must align for a true reversal.
A Piercing Line pattern is a bullish reversal signal that appears after a downtrend. However, this pattern failed to reverse the bearish trend in today’s price action due to the following key reasons:
1. Lack of Follow-Through Buying
• A strong Piercing Line requires the next candle to be bullish, closing above the previous day’s high, confirming a shift in momentum.
• Instead, today’s candle is a strong bearish engulfing bar, completely wiping out the bullish intent. This shows sellers overpowered buyers immediately.
2. Rejection at Key Resistance (Supply Zone)
• The price attempted to push higher but got rejected at 2,956-2,972 (VWAP Upper Band & VSA Resistance).
• Liquidity absorption at this level suggests smart money selling into strength, not accumulation.
3. Weak Volume Confirmation
• A strong Piercing Line should come with increasing volume, indicating strong buying pressure.
• Volume was weak (-5.8%), meaning there was no real commitment from buyers.
• A spread increase (+74.95%) without volume support suggests a liquidity grab rather than true demand.
4. Order Flow Shows More Aggressive Selling
• Delta is negative, indicating more market sells than buys.
• The footprint chart shows large sell orders dominating, meaning big players are still offloading.
5. Bearish Momentum Dominates Lower Timeframes
• 1H, 4H, and 8H charts show bearish continuation patterns with price breaking key VWAP levels.
• No higher highs or strong demand zones were created, meaning bulls are not defending.
Conclusion: No Bullish Confirmation → Bearish Continuation
A Piercing Line is only valid if buyers sustain momentum. Since today’s session completely erased the bullish signal, this is a failed reversal and more downside is expected.
Trade Plan (Bearish Bias)
• Sell Below: 2,891
• Stop Loss: 2,920
• Target 1: 2,863
• Target 2: 2,850-2,810
👉 Key Takeaway: Price action alone is not enough. Volume, order flow, and momentum must align for a true reversal.
Mohamed
THE Ichimoku MAN on the Nile
#traders4traders
you are welcome to join my Telegram channel, Ichimokuonthenile.
for GOLD follow this link: t.me/GOLDontheNILE
youtube youtube.com/@ICHIMOKUontheNILE
THE Ichimoku MAN on the Nile
#traders4traders
you are welcome to join my Telegram channel, Ichimokuonthenile.
for GOLD follow this link: t.me/GOLDontheNILE
youtube youtube.com/@ICHIMOKUontheNILE
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Mohamed
THE Ichimoku MAN on the Nile
#traders4traders
you are welcome to join my Telegram channel, Ichimokuonthenile.
for GOLD follow this link: t.me/GOLDontheNILE
youtube youtube.com/@ICHIMOKUontheNILE
THE Ichimoku MAN on the Nile
#traders4traders
you are welcome to join my Telegram channel, Ichimokuonthenile.
for GOLD follow this link: t.me/GOLDontheNILE
youtube youtube.com/@ICHIMOKUontheNILE
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.