A weapon that marks a large falling candle whose body completely wraps the previous rising candle’s body, in an uptrend.
- Weapon tier
- Starter tier
- Slots used
- Candle markings 1/3
Concept
Yesterday the buyers won, but today the price opened at or above yesterday’s close and closed at or below yesterday’s open. In one day it erased all of yesterday’s rise.
At the end of an uptrend it is often read as a sign that the trend may turn down. It is a pattern you read from two candles together.
- Bearish Engulfing
Charts by TradingView Lightweight Charts™
80 candles with volume. After a rise, candle 60 (yellow vertical line) near the top is a falling candle that wraps the rising candle before it. The price then falls sharply. Keyboard: ←/→ to move, +/− to zoom, 0 to see the whole chart.
The yellow vertical line is the second candle of the bearish engulfing pattern. It appeared near the top of the rise, and the trend then turned down. This scene was picked because it worked out — making a new high after the pattern is common too. Drag the chart sideways with a finger or the mouse to move it, and pinch with two fingers to zoom in. With a keyboard, click the chart, then use ←/→ to move and +/− to zoom.
How it is calculated
Trend: if the close is above the average close of the last 10 candles, it is an uptrend.
If yesterday was a rising candle (close > open), today is a falling candle, today’s open ≥ yesterday’s close and today’s close ≤ yesterday’s open, it “engulfs”.
Today’s body must also be longer than the average body of the last 10 candles × 1. If all of this holds, today’s candle is marked.
Parameters
| What it sets | Name in the game | Default | Range |
|---|---|---|---|
| Candles used for the average body | lookback | 10 | 5 – 30 |
| Candles in the closing-price average used to judge the trend | trendPeriod | 10 | 3 – 60 |
| How many times the average body the body must exceed | bodyMultiple | 1 | 0.3 – 3 |
Trading ideas
A bearish engulfing pattern at the end of an uptrend, especially with heavy volume, is often read as “sellers have taken over”. Watch whether the following candles fail to get above today’s high.
One that appears while the price is moving sideways, or in a weak trend, means less.
Common traps
- Being a two-candle shape, it is common. It also shows up often in small pullbacks inside an uptrend.
- The check judges the trend only from the closing-price average. Whether this is the top of a long trend needs a separate look.
- The chart on this page is a picked scene. Read it together with the trend (lesson 2) and volume.
In the game
- “Bearish Engulfing” is an “Starter tier” weapon and uses 1 “Candle markings” slot (limit 3). It uses no chart lines and no indicator panel.
- In the game, every candle that meets the conditions gets a faint gray vertical line in the price area, and only the most recent line is labeled “Bearish Engulfing”. The chart on this page looks the same; the yellow vertical line is an extra mark for the candle this page talks about.
- If you equip several “Candle markings” weapons, their lines are told apart as solid, dashed and dotted.
Related indicators and lessons
- Three White Soldiers — A candle-pattern marker that puts a vertical line on the third of three big up candles closing higher one after another.
- Three Black Crows — A candle-pattern marker that puts a vertical line on the third of three big down candles closing lower one after another.
- Morning Star — A candle-pattern marker for a three-candle bottom shape — big down candle, small-bodied candle, big up candle — with a vertical line on the third candle.
- Evening Star — A candle-pattern marker for a three-candle top shape — big up candle, small-bodied candle, big down candle — with a vertical line on the third candle.
- Hammer — A candle-pattern marker that puts a vertical line on a single candle in a downtrend with a long lower shadow and almost no upper shadow.
- Inverted Hammer — A candle-pattern marker that puts a vertical line on a single candle in a downtrend with a long upper shadow and almost no lower shadow.
- Hanging Man — A candle-pattern marker that puts a vertical line on a single candle in an uptrend with a long lower shadow and almost no upper shadow.
- Shooting Star — A candle-pattern marker that puts a vertical line on a single candle in an uptrend with a long upper shadow and almost no lower shadow.
- Doji — A weapon that finds and marks candles whose open and close are almost the same, so the body is very thin. It is a candle where buyers and sellers ended up evenly matched.
- Bullish Marubozu — A weapon that finds and marks rising candles with almost no shadows and a body far longer than usual. Buyers pushed all the way through the candle.
- Bearish Marubozu — A weapon that finds and marks falling candles with almost no shadows and a body far longer than usual. Sellers pushed all the way through the candle.
- Bullish Engulfing — A weapon that marks a large rising candle whose body completely wraps the previous falling candle’s body, in a downtrend.
- Piercing Line — A weapon that marks, in a downtrend, a rising candle that opens below a long falling candle and closes above the middle of that candle’s body.
- Dark Cloud Cover — A weapon that marks, in an uptrend, a falling candle that opens above a long rising candle and closes below the middle of that candle’s body.
- Bullish Harami — A weapon that marks, in a downtrend, a small rising candle that fits entirely inside the body of the long falling candle before it.
- Bearish Harami — A weapon that marks, in an uptrend, a small falling candle that fits entirely inside the body of the long rising candle before it.
- 1. Reading a single candle
- 2. Trends and sideways moves