Dark Cloud Cover β Bearish Reversal Signal π
π The Dark Cloud Cover is the bearish counterpart of the Piercing Pattern, seen at the top of an uptrend.
β
Formation (2 candles):
1οΈβ£ Strong bullish candle in an uptrend.
2οΈβ£ Bearish candle that opens above the previous high but closes below the midpoint of the first candle.
β
Meaning: Buyers are losing strength β sellers taking control β reversal possible.
π Example: Stock rallies βΉ760 β βΉ800, next candle opens βΉ810 and closes βΉ785 (below midpoint βΉ785) β Dark Cloud Cover β bearish reversal likely.
π§ Rule: Stronger signal if volume rises on the bearish candle.
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