Piercing Line Trading System

Piercing Line Trading System for MetaTrader 5

Piercing Line Trading System is a price action indicator for MT5 designed to detect two-bar bullish reversal patterns and display structured trading levels on the chart.

Overview

Piercing Line Trading System detects a two-candle bullish reversal structure in which a bearish candle is followed by a recovery candle that closes back into the body of the first candle.

This formation can be used to identify possible reversal conditions after downward price movement.

All calculations are based on completed bars only.

Detection is non-repainting. Signal values do not change after the bar is closed.

The indicator can draw Entry, Stop Loss, and Take Profit levels directly on the chart and track signal progress after detection.

Detection Logic

The detection model is based on two completed candles and requires several structural conditions.

The first candle must represent bearish movement with sufficient body size and structure quality.

The second candle must open lower and then recover upward, closing above the midpoint of the first candle’s body.

The indicator can also verify that the pattern forms during a short-term downtrend before accepting the setup.

Additional checks can be applied for body size, penetration depth, relative structure, and minimum displacement conditions.

Signals that do not meet the selected structural thresholds are ignored.

Quality Evaluation

Each valid pattern can be evaluated through a multi-factor quality model.

The scoring process can include measurements such as:

• Penetration depth into the first candle body

• Candle size relative to ATR

• Opening displacement

• Body ratio

• Relative body strength

• Directional reversal structure

Signals below the selected minimum threshold can be filtered out automatically.

Multiple detection modes are available, including Standard Mode, Strict Mode, and Custom Mode.

Entry and trade planning

For confirmed setups, the indicator can calculate trading levels directly from the detected pattern.

For each valid setup, the indicator can display:

• Entry level

• Stop Loss level

• Up to four Take Profit levels

• Risk and reward zones on the chart

Take Profit levels can be displayed as 0.5R, 1.0R, 1.5R, and 2.0R.

Stop Loss can be calculated using a pattern-based method, ATR-based logic, or Donchian Channel reference.

An optional trailing stop based on Donchian logic is also available for users who want dynamic trade management after entry.

Filters and tools

Optional filters are available to reduce unnecessary signals:

• Quality Filter

• Extreme Zone Filter

• Direction Filter

• Stoploss Hunt Filter

• Signal Zone Filter

• Spacing Filter

• Opposite Signal Filter

The built-in scanner can monitor multiple symbols and timeframes from a single chart.

The indicator also includes BOS and CHOCH labels, a signal dashboard, alert options, chart themes, statistics tracking, and output buffers for Expert Advisor integration through iCustom().

Recommended use

Recommended timeframes are H1 and H4 for clearer structure, while lower timeframes can be used with stricter filtering settings.

The indicator can be applied to Forex pairs, XAUUSD, indices, and crypto symbols, depending on broker data quality and symbol characteristics.

Loading sufficient chart history is recommended for more stable structure analysis.

MetaTrader 5 only.

No DLL calls.

No external WebRequest connections.

Important notes

This indicator is a technical analysis tool.

It does not guarantee trading results.

Users should test settings in their own environment and apply appropriate risk management.

Support is available through the product comments section or via MQL5 direct message.