Bearish Engulfing Candlestick Pattren
Is Made up of 2 candlestick and usually appears at the end of the uptrend then bears enter into the market and take the price down.
It is formed by two candles, the second candlestick engulfing the first candlestick. The first candle being a bullish candle indicates the continuation of the uptrend.
The second candlestick chart is a long bearish candle that completely engulfs the first candle and shows that the bears are back in the market.
Traders can enter a short position if next day a bearish candle is formed and can place a stop - loss at the high of the second candle
Important Points
1. The second candle must engulf the body of the previous Candle. (It is better if wicks of the previous candle are also engulfed by the second candle).
2. The Previous trend must be an uptrend.
3. The volume of the second candle should be higher than the volume of the previous 2 candles.
4. Take the sell position below the low of the second candle.
5. Keep the stop - loss above the high of the green candle.
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