engulfing patterns
An "engulfing pattern" is a type of candlestick pattern used in technical analysis to indicate potential reversals in the price of a security. It occurs when a smaller candlestick is followed by a larger candlestick that completely engulfs the previous one. This pattern can signal a shift in market sentiment, suggesting that buyers or sellers are gaining control.
There are two main types of engulfing patterns: the bullish engulfing pattern and the bearish engulfing pattern. A bullish engulfing pattern appears at the end of a downtrend, indicating a potential price increase, while a bearish engulfing pattern occurs at the end of an uptrend, suggesting a possible price decline.