Bullish/Bearish Engulfing

Bullish engulfing candlestick pattern

About Bullish Engulfing pattern:- Bullish engulfing is one of the most popular candlestick pattern among the traders. This one of the reversal candlestick pattern. Bullish engulfing pattern can be applied in any market like Forex, Stock or Commodity.

Things to remember before trading bullish engulfing pattern:-

1. Bullish engulfing must be traded at support level only. The support level could be the horizontal lines, trendlines, pivot points or dynamic support like moving averages. If you see bullish engulfind other than mentioned location, it should not be traded.
2. Before trading bulling engulfing, make sure previous trend is down or at least it is a retracement of uptrend. If bullish engulfing is traded at 50% fibonacci retracement level, the winning probability is high.
3. Volume plays an important role while trading bullish engulfing so volume of green candle must higher than volume of previous red candle. If there is no volume support, then such a patterns should not be traded. 
4. One question is always being asked by people that, should we considered only body or wick as well and there are very different opinions can be seen. As per my opinion, we can consider the body part but if wick of red candle is also engulffed by green candle then it is even stronger trend reversal indication.
5. Now entry, exit and take profit. Entry should be made at the high of green candle and stoploss should be placed at lowest point amongst the pair. Profit can be booked at previous swing resistance or at least 1:2 ratio. 
6. Bullish engulfind candlestick pattern can be traded at any time frame starting from 1 min to 1 month depend on what type of trader you are i.e scalper, intraday trader or swing trader but one thing to be kept in mind that volume is the king here and it should be followed strictly.

Bearish Engulfing candlestick pattern

About Bearish Engulfing pattern:-
 Bearish engulfind is exactly opposite of bullish engulfing. It appears in up trending market and then reverses the trend. 

Things to remember before trading bearish engulfing pattern:-

1. Bearish engulfing pattern must be traded at resistance level only. The resistance  level could be the horizontal lines, trendlines, pivot points or dynamic support like moving averages. If you see bearish engulfind other than mentioned location, it should not be traded.
2. Before trading bearish engulfing, make sure previous trend is up or at least it is a retracement of downtrend. If bearish engulfing is traded at 50% fibonacci retracement level, the winning probability is high.
3. Volume plays an important role while trading bearish engulfing so volume of red candle must higher than volume of previous green candle. If there is no volume support, then such a patterns should not be traded. 
4. Now entry, exit and take profit. Entry should be made at the low of red candle and stoploss should be placed at highest point amongst the pair. Profit can be booked at previous swing support or at least 1:2 ratio. 
5. bearish engulfind candlestick pattern can be traded at any time frame starting from 1 min to 1 month depend on what type of trader you are i.e scalper, intraday trader or swing trader but one thing to be kept in mind that volume is the king here and it should be followed strictly.