Engulfing
Pattern
Description
This
very common bullish reversal pattern is considered moderately reliable.
A
black candlestick day is engulfed completely by a long white/empty candlestick the
next day that gaps below the previous day’s low and then rallies to close above
its high.
The
gap down, in a downtrend, is seen as a point where bulls exit the scene. When
the selling ends, shorts rally the stock to close above the previous day’s high.
Confirmation is needed by the evidence of higher volume.
Market
Opinion
Bullish.
Pattern
