The bearish engulfing pattern is the opposite of the bullish pattern.
It signals a reversal of the uptrend and indicates a fall in prices by the sellers who exert the selling pressure when it appears at the top of an uptrend
This pattern triggers a reversal of the ongoing trend as more sellers enter the market and they make the prices fall.
What Does the Bearish Engulfing Look Like?
Trading Example: 1
Similarly when trading with the Bearish Engulfing pattern, one should remember the below points:
- Prior trend: One should note that the prior trend uptrend
- Pattern: The second candlestick should be bearish and engulfing the body of the first candlestick.
- Stop loss: Stop loss can be placed below at the high where the bearish engulfing pattern occurs.
- Confirmation of the pattern: Also, don’t forget to confirm the signals given by this pattern with other technical
Learn – What is the Hanging man Candlestick Pattern?
Live Example
