Now will move towards the next bullish reversal candlestick pattern that is bullish engulfing.
Like Hammer, you will also find that you are getting a lot of bullish engulfing on the chart.
So bullish engulfing pattern contains two scandals.
First, Candy, as you can see, is a very scandal and second, scandal is a bully scandal who's open?
Try to understand who's open is below the close of the candle and whose nose is above the open of Burish
Candle, and ideally speaking, that bullish candle should completely cover the bearish candle of previous
dean.
So when this is fun, then we call it as a bullish engulfing.
What does it indicate?
See, this reversal patterns are to be traded when market is falling to see what the market is falling
and falling market.
This bearish scandal has come.
So that means that bears were in control when this candle closed below its open.
What happened on the next day?
Next, the market open.
Get down.
That means at the time of open bears were in control of the market.
But what happened?
Bears tried to pull the market down, but failed to do so.
Bulls came into the picture and bulls closed the market above this high.
So ideally speaking, markets should close above this high because this high is acting as a resistance
to the price.
So when this resistance is broken, it's a good sign.
So technically speaking, this is how it should happen.
So that is the logic behind bullish engulfing and bullish engulfing is a very strong bullish pattern
and which can reverse the existing trend so quickly.
Recap that bullish engulfing is a two candle pattern.
This pattern is formed when the market is in downturn trend wherein for scandal is a very scandal.
And second scandal is a bullish scandal which opens lower than the previous lows because this is where
it's open and this is the closed open below disclosed and closes above the previous high.
So this is the previous high end market is closing above this.
So this is how this is where the bullish engulfing is completed.
What does it indicate indicate that sellers are losing the strength, isn't it, because bulls are taken
control and buyers are gaining the control in the market and that can be a sign of a reversal of the
trend.
Now, we are going to go in the chart and see a few examples.
And I'll also tell you how you can trade them.
So this is a graph of Reliance Industries, can you spot a bullish engulfing in this case?
Yes, so this is where you have bullish engulfing this one, isn't it?
So basically market is falling.
Bears were in control, but bullish engulfing this form.
And this is a sign of trend reversal.
This is an example of bullish engulfing and it worked.
The bullish engulfing came and market went up substantially.
Then we have another example of bullish engulfing in this case.
That is this one.
This is, again, a bullish engulfing that field, isn't it?
So the market should have reversed, but that did not work.
So this is where our filter will come into play.
Our interest is that you should take bullish engulfing.
The market is falling to check number one.
And second, is that the next scandal, which is this one?
This should open bullish, which did not happen.
Market closed here and then open lower than this.
So this scandal was not bullish.
So therefore, second condition is not satisfied.
So in this case, we will not take this great trade.
But in case of this bullish engulfing, you can see that the next Candlewick Open was bullish when it
opened higher than this.
And this is where we are going to take the train.
Do you have to filtrate your trades in such a way that you don't take all of them?
We are to take only those which give us a higher probability.
This is, again, a graph of Hasbi.
Can you spot a bullish engulfing in this case?
This is one.
So you can see that let me zoom out a bit, you can see that market is falling, market is falling,
isn't it?
And that is a bullish engulfing that is formed and market open above this close.
This is where we are going to enter and you can see that market rallied.
This is, again, an example.
I'll give you another example of Tata Steel here.
Can you spot the bullish engulfing?
I can see two bullish engulfing zero.
This is the first one.
Again, market is falling.
Check number one second.
The next scandal is open higher than this.
So at this open, we are going to initiate the trade.
Politics are there and we are going to go along.
Then another bullish engulfing is this one.
When?
Market is falling and bullish, engulfing its form, but you can see here that the next scandal is not
a bullish one.
So we will not go along as as far as this becomes green.
But you can see the next to that candle is green one.
So this is where we have to take a decision that whether you are going to go along or not.
But yes, in this case, if I was in this case, I would have gone along support because, ah, there
you can go alone.
So this is how you can find out the high probability trade using bullish engulfing, bullish engulfing
is a very strong bullish pattern that is available for you to trade.
Now, I am not going to give you a gloomy picture that all the bullish engulfing will work.
Now, I will give you a few examples.
Were in bullish engulfing, did not work.
And I'll also tell you why it did not work.
So let's take an example of the same Tata Steel and I'll tell you a trade in which it did not work.
See here, is it a bullish engulfing?
Yes, market is falling, bullish, engulfing its form, but it should reverse the trend, which did
not happen.
Why?
Because see the next scandal.
What is the next scandal in this case?
Next scandal open Burish.
So are you going to trade?
No, we are not going to put the trade.
So this is where our partners feel.
Why?
Because the next scandal is bearish one.
Ideally speaking when bullish, engulfing his home, next scandal should open in green because that
is the logic, whole logic behind this.
If market is opening lower, then the whole point of trend reversal is not happening.
So therefore, in this case, it did not work.
I'll give you another example.
Now, this is another example of ISBA wherein you can see a bullish engulfing Barford bullish engulfing
market is falling first.
Second, you have to see the second candle.
Next scandal.
This is the next scandal.
Is it a bullish one?
No.
Even next to that scandal is not bullish.
One next to next scandal is not bullish one.
So if you see, you can consider one to two scandals after the bullish.
Engulfing is fun.
And if both of them they are not supporting the bullishness, then there is no point in trading that
particular bullish engulfing, isn't it?
And I'll give you another example where it did not work.
So this is a chart of ICICI Bank.
But bullish engulfing the market is falling, but see the next scandal, this is the next scandal.
What is the scandal in open British Open lower than the close of scandal.
We are not going to trade.
The market was falling.
That was the first week.
But next scandal did not open bullish.
We are not going to take this trade.
So this is how you have to filter.
So I want you to study bullish engulfing patterns like this and not see to yourself what works and what
does not work that will give you more confidence while trading.