SocialForex
Intermediate

Meeting Line Pattern – Bearish Reversal

Learn about the Meeting Line pattern – a strong bearish reversal signal, including how to identify it and trade it effectively.

Mark · Trader & Founder, Social Forex

Meeting Line Pattern – Bearish Reversal

Definition

The Meeting Line pattern is a two-candle bearish reversal formation. The first candle is a strong bullish candle (long green body), and the second candle is a bearish candle (red body) that opens above the first's high but closes at or very near the first candle's close. This creates a 'meeting line' at the closing price level.

How to identify

  • Candle 1: a strong bullish candle with no significant wicks.
  • Candle 2: a bearish candle that opens higher (gap up or opens near the top), closes at or very close to candle 1's close.
  • Volume on candle 2 is often higher than on candle 1, confirming selling pressure.
    • Price Action — reading candlestick patterns in context

    How to trade

  • Entry: When price breaks below the low of candle 2 or a nearby support level.
  • Stop loss: Place above the high of candle 2 with a buffer (e.g., 5-10 pips).
  • Take profit: Target 1:1 or 1:2 risk-reward ratio, or based on Fibonacci/Swing levels.
  • Confirmation: Wait for a third bearish candle or an overbought signal from RSI/Stochastic.

    • Real example

    Consider EUR/USD on H4 timeframe in a short uptrend. A strong bullish candle (body 30 pips) appears, followed by a bearish candle opening 10 pips higher but closing exactly at the previous close (1.1050). Volume spikes. You enter short at 1.1045, stop loss at 1.1075 (20 pips above the high), take profit at 1.1010 (1:1.2).

    Common mistakes

  • No confirmation: Two candles alone are insufficient; wait for a third bearish candle or volume confirmation.
  • Confusing with Doji: Doji have very small bodies, while Meeting Line requires a distinct red body on candle 2.
  • Trading in a range: The pattern works best when the prior trend is clearly bullish.
    • Price Action — reading candlestick patterns in context

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

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