Please show me a classical case of an Engulfing Candlestick pattern on a chart
Hi Long, l read your reply to a request for scalping strategy as follows:
It is very easy
engulfing candlestick appear
next bar open entry
+5 PIPS target
you can take profit
Please show me a classical case of an engulfing Candlestick pattern on a chart
Important Candlestick components
Candlestick patterns are widely used trading tools.
Traders analyze their safe investment time analyzing the candlestick patterns of the market, which is connected to the expectations, trader flow and the variation of prices.
To get the best advantage from candlestick patterns, traders should have proper knowledge about the pattern.
The first step of knowing about the candlestick pattern is to know about their components.
Candlesticks have a body, shadows also known as wicks or tails and color.
Basically candlesticks are either green or red.
The candles are created from the adjustments of open, high, low and close prices.
A bullish candle is represented by a green candle which shows the highest price in the upper wick, the lowest in the lower wick, the opening price in the bottom of the candlestick body and the closing price in the starting point of the body.
A bearish candle is represented with a red candlestick and the closing price is shown in the bottom of the body and the opening price at the starting of the body.
The size of the body and the wick is very important as these components create various patterns which signify to various conditions of the market and help a trader to take a decision about the trading.
The most common patterns are hammer, hanging man, Doji, gravestone etc.
Many of these 4 patterns look quite similar.
Most of the expert traders always trust on a pattern zone, instead of trusting just the pattern of that day.
Analyzing any candlestick pattern and trading trusting them is not easy for the traders.
But the best way to make a decision is by following the patterns of a week and then combining them to get a proper result.
Whatever the methods are, the high accuracy rate of candlestick pattern analyzing is making it popular to the traders and might continue to do it.