When facing a strong engulfing candlestick, the core of the entry method choice lies in balancing 'cost performance' and 'certainty'. The following three strategies can be flexibly selected based on one's risk preference:
Limit order (priority cost performance)
Place an order in advance at the 50% position of the engulfing candlestick's body. The advantage of this method is that it allows entry at a relatively better price, offering greater potential profit; however, the downside is that if the price does not retrace to that position, one may miss the trading opportunity. It is suitable for traders who can accept the 'missed opportunity risk' and seek cost advantages.Enter after confirmation (priority certainty)
Wait for the engulfing candlestick to completely close, or enter after the next candlestick opens. This action can reduce the risk of false breakouts by ensuring the complete presentation of the candlestick pattern or the initial follow-up of subsequent prices, resulting in higher certainty; however, the cost is that the entry price is usually not as ideal as placing an order, suitable for traders who value 'signal reliability' and are willing to sacrifice some costs.Enter after breaking the low (extremely conservative)
Only enter after the price breaks below the low of the engulfing candlestick. This is the most cautious approach, confirming trend strength through further price declines, which can filter out short-term volatility interference to the greatest extent; however, the downside is that the entry point is relatively late, which may cause one to miss part of the trend in its initial phase. It is suitable for traders with very high requirements for 'trend clarity' and who can accept larger drawdowns.
It should be noted that 'cost performance' and 'certainty' are essentially contradictory — pursuing lower costs often means higher missed opportunity risks, while waiting for clearer signals necessarily incurs higher entry costs. Therefore, the key to selection is not which method is absolutely better, but whether you can accept potential short-term drawdowns and whether you have the patience to wait for the signal to be fully confirmed. Matching your own risk tolerance and trading style is the more important principle.
