Engulfing Pattern

Even I personally have left the method or trading style like Buy Low Sell High, but sometimes I think it's still interesting in doing that. Since if it's a right hit, then it's very nice in profit, as you buy at bottom sell on top. Since a lot of doing this way, I'll introduce you all this pattern which is your favourite.

1. Bullish Engulfing Pattern
Usually this pattern appears in a bearish position, where trend is going down & suddenly we spot this pattern & we know that this is a bottom. But again, not all of this kind of pattern is a confirmed bottom, but usually they are bottom.

Criterias:

1. You spot a lower open than previous close
2. You spot a higher close than previous open
3. High volume spike at the white candle & a declining volume at the recent decline bar volume

 

2. Bearish Engulfing Pattern

Usually this pattern appears in a bullish position, where trend is going up & suddenly we spot this pattern & we know that this is a top. But again, not all of this kind of pattern is a confirmed top, but usually they are bottom. Because no one knows how high can a stock goes, sky is the limit.

Criterias:

1. You spot a higher open than previous close
2. You spot a lower close than previous open
3. High volume spike at the black candle & a declining volume at the recent decline bar volume

Happy Weekend...^^

Happy Investing^^
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