The Bullish Engulfing Pattern

A Bullish Engulfing Pattern is a two-day candlestick pattern that signals a possible trend reversal. The first day's candle is a small black candle, followed by a large white candle on the second day, where the white candle's body engulfs or overlaps the previous day's candlestick.

If this pattern occurs at the end of a downtrend, it can suggest a reversal in the trend. In this pattern, white candles open lower than the previous day's black candle and close higher than its high, indicating a shift in sentiment from bearish to bullish.

A complete overlap of the previous day's candle indicates that selling pressure is dissipating, and bullish momentum is gaining strength. This pattern suggests that buyers have taken control of the market from sellers. To further confirm the reversal, the next candle should close higher than the bullish engulfing pattern. This confirmation will indicate the start of a new uptrend.