The In Neck pattern is almost a Meeting Line pattern. I t has the same description as the On Neck pattern except that it closes at or slightly above the previous day’s close. Confirmation is suggested.
The In Neck Line indicates some short covering, but not a change in trend direction.
Criteria
1. A long black candle forms in a downtrend.
2. The next day gaps down from the previous day’s close; howver, the body is usally smaller than one seen in the Meeting Line pattern.
3. The second day closes at the close or just slightly above the close of the previous day.
Pattern Psychology:
This is the same scenario as the On Neck pattern. After a market has been moving in a downward direction, a long black candles enhances the downtrend. The next day opens lower, a small gap down,but the trend is halted by a move back up to the previous day’s low. The buyers in this upmove should be uncomfortable that there was not more strength in the upmove. The sellers step back in the next day to continue the downtrend.