The Meeting Line candlestick pattern looks similar to the On Neck Line pattern but is a reversal pattern. In contrast, the On Neck Line is a continuation signal.
Note that the Meeting Line candlestick pattern can be a bullish reversal pattern and also a bearish reversal pattern. It depends on where the pattern appears.
This is how to spot a Meeting Line candlestick pattern:
1) Like in all the patterns we are going to discuss, the long-term trend (1-year trend) should be in an uptrend. There is very little chance to succeed if the long-term trend is against your favor. Remember, it is difficult to swim against the tide. Our job as technical chart readers is to wait for the right time when the tide itself is going where we want to go.
2) The intermediate-term trend (3 months trend) should also be preferably bullish.
3) There should be a minor correction or a pullback. Remember, as a trend follower, a minor pullback after a bullish upswing is the best time to enter.
4) The first candle has the color of the current trend. Thus, in a pullback, the color of the first candle is red. In an upswing, the color of the first candle is green.
5) The second candle opens at a gap but by the day’s closing, it retraces to the previous candle’s close.
6) Both the first and the second candles are extended (long) candles.
7) It is better if there are no shadows where they meet.
8) Wait for a third candlestick confirmation. Otherwise, the Meeting Line candlestick pattern may sometimes end up becoming the Separating Line candlestick pattern, which is a continuation pattern.
