Engulfing candle (bullish and bearish engulfing)

Rules

• Bullish engulfing: after a decline, a red candle followed by a larger green candle whose body covers it.
• Bearish engulfing: after a rise, a green candle followed by a larger red candle that covers it.
• Only bodies count; wicks do not need to be engulfed.
• The larger the second body relative to the first, the stronger the read.

Why it matters

The second candle opens beyond the first candle's close and finishes beyond its open, so the side that was winning has lost the whole period's ground. Near support or resistance, and on higher volume, that shift carries more weight.

Mistakes to avoid

Engulfing candles in the middle of a range mean little. On 24/7 markets there are few opening gaps, so crypto engulfing candles often start at the prior close and need a clearly larger body to count.

On BRVX

BRVX markets trade 24/7, including stocks on weekends, so engulfing patterns form continuously rather than around market opens. Traders who act on one usually place the stop beyond the engulfing candle's far end.