Bearish Engulfing Pattern: How to trade with it?

 Hello....how are you. In this article, I am going to talk about one of the most powerful candlestick patterns, i.e Bearish Engulfing Pattern.

Bearish Engulfing pattern is just the opposite of Bullish Engulfing Pattern.

What is Bearish Engulfing Pattern?

Bearish Engulfing Pattern is just the opposite of the Bullish Engulfing Pattern.

Suggested: How to trade big with Bullish Engulfing Pattern?

Bearish Engulfing pattern is the first candle that appears after the long series of the green or bullish candle.

If we see a continuous green candle and later a strong Red candle that engulfs the green candle appears then we can say that it is Bearish Engulfing Candle.

How to Find Bearish Engulfing Pattern?

To illustrate Bearish Engulfing Pattern I am going to use Binomo.

If you don't have a Binomo account. Click here.

You can also sign up via the form below. 

 

You can sign up here try...

Once you click the link above you will land on the Binomo homepage.


Now, click on the give it a try and enter your email, password, select currency & more.


Once you have signed up you will land on the Binomo dashboard.


Now, click on the chart button and select Candfle from the menu.



Now, In this article, I going to use Support and resistance to confirm my calls.

If you don't know how to draw support and resistance click here.

Suggested Read: How to draw Support & Resistance lines?

Firstly, click on the drawing tool and select the Horizontal line from the menu.


Now, Select your favourite colour and click on an apply theme.


Lastly, place the horizontal lines on support and resistance level.



That's it the basic setup is over.!!!


Now, talking about  How to Find Bearish Engulfing Pattern? well, it's damn very easy.

Firstly what you need to do is find a long series of Green bullish candle.


Secondly, find the red candle that appears after a long series of green candles.


Remember, the red candle must be equal to or must bigger than the green candle. As given above. hence, we can say it is a Bearish Engulfing pattern.

How to trade with Bearish Engulfing Pattern?

Trading with a bearish engulfing pattern is very easy.

The golden rule of Bearish Engulfing Pattern says:

If we see a bearish engulfing pattern plus the If the candle breaks the support level, then we should go for a BUY trade.

 

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