Bullish Engulfing is a multiple candlestick chart pattern that is formed after a downtrend indicating a bullish reversal.
Traders can enter a long position if next day a bullish candle is formed and can place a stop-loss at the low of the second candle.
It is formed by two candles, the second candlestick engulfing the first candlestick. The first candle is a bearish candle that indicates the continuation of the downtrend.
The second candlestick is a long bullish candle that completely engulfs the first candle and shows that the bulls are back in the market.
Below is an example of Bullish Engulfing Candlestick Pattern:
Tags:
Candlestick Patterns