Dear traders, today let's talk about two classic reversal signals in candlestick patterns—Piercing and Dark Cloud Cover. These two tools can save your life in real trading.

The Piercing pattern usually appears during a sustained price decline. Simply put, it’s a green candlestick that breaks through the real body of the previous red candlestick, with a penetration depth exceeding 50%. This signal often indicates that the bearish momentum is weakening, and the bulls may start to gain strength, suggesting a potential reversal to the upside.

Conversely, the Dark Cloud Cover pattern is the opposite. In an uptrend, a red candlestick heavily presses down, crossing more than half of the previous green candlestick's real body. At this point, be alert—bullish momentum might be hitting a ceiling, and a price correction or even a decline could be imminent.

When looking at the chart, you'll notice specific stop-loss and take-profit levels marked nearby. This is the core of trading—simply identifying the pattern isn’t enough; managing risk is key. When you enter a long position based on the Piercing pattern, you must set a stop-loss to prevent black swan events, and also plan your take-profit target in advance to lock in profits.

Large coins like $BTC often exhibit these classic patterns most clearly. However, it’s important to remember that no technical signal is 100% accurate; the market always has surprises. So, the old trading adage still applies—manage risk and trade rationally.