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Bullish Counterattack Line – Reversal Candle Pattern

Learn the Bullish Counterattack Line – a simple two-candle reversal signal for beginners, including how to identify and trade it safely.

Mark · Trader & Founder, Social Forex

Bullish Counterattack Line – Reversal Candle Pattern

What is Bullish Counterattack Line?

The Bullish Counterattack Line is a two-candle reversal pattern that appears after a downtrend. It shows sellers pushing price lower at the start of the second candle, but buyers fighting back aggressively and closing the candle right at the previous candle's close. This indicates that buying pressure is taking control.

How to Identify

Look for these conditions:

  • A long bearish candle (red/black) in a downtrend.
  • The second candle opens significantly lower than the first close, creating a downward gap.
  • The second candle closes at or very near the close of the first candle, usually as a bullish (green/white) candle.

    • The two candles look like two fighters touching gloves: the second candle was pushed down but stood back exactly at the first candle's defense line.

    Price Action — reading candlestick patterns in context

    How to Trade

  • Wait for confirmation: Do not buy immediately. Wait for a follow-through bullish candle or a break above the high of the pattern.
  • Entry: Buy once price breaks above the high of the second candle or the pattern high.
  • Stop loss: Place your stop below the low of the second candle to limit risk.
  • Take profit: Target the nearest resistance, or use a risk-reward ratio of at least 1:2.

    • Real Example

    Suppose EURUSD falls from 1.1050 to 1.1000. The first candle closes at 1.1000. In the next session, price opens at 1.0980 and seems ready to fall further, but buyers push it back and close at 1.1000. The pattern is complete and warns that the downtrend may be ending.

    Common Mistakes

  • Trading the pattern in the middle of an uptrend, not at a potential reversal.
  • Ignoring stop loss or placing it too far away.
  • Confusing it with the Piercing Line. The Counterattack Line is usually a weaker signal, so it needs additional confirmation.

    • Content is for reference only, not investment advice. Forex trading carries high risk.

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