All Forex traders come across the Price Action at some point and this is not a mere chart analysis technique but the entire system for defining the possible future price movement direction. The Engulfing pattern is when the body and shadows of a bar completely engulf the body and shadows of the previous bar.
There are two types of patterns the software detects
What Is an Engulfing Candlestick Pattern?
A bullish engulfing pattern is characterized by a bullish candle whose body, the open and close engulfs the previous candle's body. Conversely, a bearish engulfing pattern is characterized by a bearish candle whose body engulfs the previous candle's body.
This chart shot was taken from cTrader using the Engulfing Pattern Detection Indicator.
Rules of the Engulfing Pattern
- It is required to operate with this pattern on higher timeframes: H4, D1.
- For a more refined entry, additional elements of graphical analysis should be applied, such as trendlines, support/resistance levels, Fibonacci levels, other Price Action patterns, etc.
- Use pending orders to avoid premature or false market entries.
- Patterns repeated in flat trading should not be used as a signal for entering the market.
Example Trade Setup for a Bearish Engulfing Pattern
The image below shows a classic example of price reversal with a bullish or bearish engulfing candle pattern, the success rate is higher when the candle is formed as it enters a resistance zone. This indicator can be used with the
cTrader Support & Resistance Indicator.Learn How To Trade Using Engulfing Candlestick Patterns
We do not just provide customers with an indicator to download we also provide educational material to learn how to trade using candlestick patterns.
Telegram Alerts
When a signal happens for a trend reversal, the indicator will send a Telegram alert directly to your PC or mobile device, this is much faster than email as it is a push notification.
POP-UP WINDOW MESSAGE
This indicator will also display the classic pop-up window when an alert occurs.
Watch a Video Demonstration
The video has been uploaded to 1080p High Quality, so do not forget to set your YouTube video quality to 1080p HD.
Duration: 12 minutes
How To Install & Remove
First, make sure you have the cTrader trading platform installed and then unzip the file and double-click on it to automatically install it onto the platform.
Any Questions?
If you have any questions or bugs, please first search our product help forum for the answer, if you cannot find it, post a new question.
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