Definition
A two-candle pattern where the second candle's body completely covers the first candle's body and points the opposite way.
The story
After a few red candles, a green candle opens at or below the last close and closes above the last open, swallowing the previous body whole. That's a bullish engulfing; a bearish engulfing is the reverse. Some traders read it as a shift in control on that timeframe.
Why you'll see it
It's among the most commonly taught two-candle patterns.
Connects to
We explain why it moves markets. What you do with it is your call. Commentary and education only. Not financial advice. All terms