Bullish Engulfing Candlesticks

Bullish Engulfing is a multiple candlestick chart pattern that is formed after a downtrend indicating a bullish reversal.

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.

Bullish engulfing pattern
Bullish engulfing pattern

Traders can enter a long position if the next day a bullish candle is formed and can place a stop-loss at the low of the second candle.
Below is an example of a Bullish Engulfing Candlestick Pattern:

bullish engulfing pattern
Bullish engulfing pattern

By ~ Capital Varsity

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