Bullish Engulfing
A large bullish candle that completely wraps the prior bearish candle's body — a strong demand-takes-control reversal signal at the bottom of a downtrend.
The Bullish Engulfing is a two-candle pattern. The first candle is bearish (continuing the downtrend). The second candle opens below the first candle's close and closes above its open — the green body fully engulfs the red body.
The gap down on open shows initial bearish follow-through; the strong recovery and close above the prior open shows buyers overwhelmed that selling completely. The bigger the engulfing body relative to the first candle, the more conviction behind the reversal.
Most reliable at a support level, after a prolonged downtrend, and with elevated volume on the engulfing candle.
Example
After a three-week slide into a demand zone, a large green candle opens below the prior close and closes decisively above the prior open, swallowing it whole. Volume spikes. Swing traders buy the close with a stop below the low of the pattern.
Related Terms
Bearish Engulfing
A large bearish candle that completely wraps the prior bullish candle's body — supply takes control — a reversal warning at the top of an uptrend.
BeginnerBullish Harami
A large bearish candle followed by a small bullish candle inside the first — downside momentum is stalling at the bottom of a downtrend.
BeginnerHammer
A single candle with a small body near the top and a long lower wick — buyers rejected a sharp intra-session sell-off — a bullish reversal signal.
BeginnerInside Bar
A candle whose entire high-to-low range is contained within the prior candle's range — consolidation and a potential breakout setup.
BeginnerKicker Pattern
Two candles of opposite colour that open at the same price with a gap — the most powerful two-candle reversal, signalling an abrupt and complete shift in sentiment.
IntermediateMorning Star
A three-candle bullish reversal: a long bearish candle, a small indecision candle gapping lower, then a large bullish candle recovering above the midpoint.
BeginnerOutside Bar
A candle that engulfs the prior candle's entire range — high-to-low — showing a sudden expansion of volatility and a potential directional shift.
BeginnerPiercing Line
Two-candle bullish reversal: a bearish candle followed by a bullish candle that opens below the prior low and closes above the midpoint of the first body.
BeginnerThree Outside Up / Three Outside Down
A three-candle reversal that adds a confirmation candle to an Engulfing pattern — the engulf flips control, the third candle proves it sticks.
Intermediate