Bullish Engulfing (Bullish Candlestick Pattern)
Bullish Engulfing is one of the strongest reversal patterns in Candlestick Patterns. The Bullish Engulfing pattern is useful for short term traders who are doing swing trading or day trading. Here's how it looks like
The bullish engulfing pattern happens in a down trend and it signals that the trend is about to reverse. The second day of the body is white (up day) and it completely engulfs the first day which is red (down day). When the body of the second day is much large than the first day, it signals extra strength. Also, when the volume of the second day is much bigger than usual, that also signals extra strength.
Let's look at a few examples on how the Bullish Engulfing Pattern looks like on real charts. As you can see, the stock rises when the bullish engulfing pattern is formed on a down trend.
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