#candlestick_patterns : Bullish Engulfing
The image illustrates the Bullish Engulfing candlestick pattern — a strong signal of a potential trend reversal from bearish to bullish, especially after a downtrend.
Pattern Identification:
First Candle: Small and red (bearish), closing lower than it opens.
Second Candle: Large and green (bullish), which completely engulfs the previous red candle’s body.
Entry Point:
A buy signal is generated once the green candle closes above the high of the red candle.
Enter the trade on the breakout of the second candle’s high.
Exit Point:
Target 1: Nearest resistance level.
Target 2: Previous swing highs or Fibonacci levels.
Stop Loss: Below the low of the second (green) candle or a recent support zone.
Trading Strategy:
Look for this pattern near strong support zones.
Confirmation is stronger if the green candle forms with high volume.
Combine with indicators like RSI or MACD for more reliable signals.
Note:
The fish illustration at the bottom is a clever analogy — the big green fish represents the bullish candle engulfing the smaller bearish ones, showing market strength shifting to the buyers.