The Bullish Engulfing Candlestick Pattern


The Bullish Engulfing candlestick pattern is one of the most commonly recognized candlestick patterns. It is a candlestick pattern that is often used by day traders to identify a bullish reversal in a stock.

In this article you will learn:

  • What is a Bullish Engulfing candlestick pattern
  • How to identify and interpret a Bullish Engulfing candlestick pattern
  • Trading techniques after confirming a Bullish Engulfing candlestick pattern

Our Latest Bullish Engulfing Stock Alert

What is a Bullish Engulfing candlestick pattern?

The Bullish Engulfing is a candlestick pattern that occurs in a downtrend and indicates high buying pressure. It is characterized by a large green candle that engulfs the candle from the previous red candle.

How to Identify a Bullish Engulfing Candlestick Pattern

Because the Bullish Engulfing pattern occurs in a downtrend, our suggestion is to look at the previous 3 trading periods to verify if the downtrend is confirmed. To confirm a Bullish Engulfing, the opening price must be below yesterday's close, and the closing price of the green candle must be higher than yesterday's open. The higher the volume usually indicates a stronger reversal signal.

Trading Techniques for the Bullish Engulfing Candlestick Pattern

It is recommended to wait one trading day to confirm the Bullish Engulfing pattern. If the following day is another green candle, this could mean a reversal in the stock and could indicate a potential bullish entry point.

Other Candlestick Patterns