πŸ“ˆ Price Action: How to trade Engulfing Candlestick Pattern the right way - IQ Option

3,178 views Β· Published 20 December 2017 Β· 10:47 Β· Indexed 6 October 2026

Channel: BO Turbo Trader Β· 2017 Β· Education

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This video is not an investment advice.

Indicators: 
EMA 3     (blue)
EMA 20   (yellow)
EMA 50   (orange)
EMA 100 (red)
EMA 200 (purple)

Bollinger Band Period 20 Deviation 2 (green)
Bollinger Band Period 20 Deviation 1 (white)

The engulfing candlestick patterns, bullish or bearish are one of the easiest of candlestick reversal patterns to identify. Because these candlestick patterns are two-candlestick patterns, they are more valid and are often looked upon as reversal patterns. A chart pattern that forms when a small black candlestick is followed by a large white candlestick that completely eclipses or "engulfs" the previous day's candlestick. 

The Bullish Engulfing Candlestick Pattern is a bullish reversal pattern, usually occuring at the bottom of a downtrend. Trading with the trend is one of the most advantageous things a trader learns to do. Using an engulfing candle day trading strategy is one way to get into trending moves just as momentum is picking up (for another entry method, see How to Day Trade the Forex Market). 

Therefore, Forex traders should be aware of the various candlestick setups that can occur in the market. Today we will discuss one of these candlestick formations. This candlestick structure is called the Engulfing candlestick pattern. Learn Candlestick Engulfing Patterns with BO Turbo Trader. The bullish harami is made up of two candlesticks. The first has a large body and the second a small body that is totally encompassed by the first. There are four possible combinations: white/white, white/black, black/white and black/black. 

Engulfing candle trading strategy that uses this candlestick pattern in a specific way, during the trend, making it a better profitability strategy. The bullish engulfing pattern is typically a buy signal because it can potentially mean a bearish trend is turning upwards. Likewise a bearish engulfing candlestick can hint that a bullish trend is reversing. In order for any chart pattern to be useful we need to know its limitations. 

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