30. How to Trade the Bullish/Bearish Engulfing Candlesticks

http://www.informedtrades.com/
A lesson on how to trade the Bullish and Bearish Engulfing Candlestick Chart Patterns for active traders and investors using technical analysis in the stock, futures, and forex markets.

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[iboibo2007]

Dave, if a bearish engulfing pattern happens (and confirmed the next day) when RSI is really low ..say RSI(9)=15..so, one one hand we have a bearish signal but on the other, we know market is way oversold and should bounce back anytime..so what will likely happen? should we expect a bear or a bull? thanks a lot for your time, i just love your lessons and appreciate your help.

[InformedTrades]

Hey iboibo2007, I don't normally look at things as if this happens then this is going to happen but more so if this happens then this is an indication of this. So if the market is very oversold and then on top of this you get a bearish candlestick pattern then I would look for other indications such as support and resistance areas to determine what the appropriate action if any should be. Hope that helps. Best Regards, Dave

[Fullperson]

sometimes I see engulfing bears and bulls when the market opens, are these to be taken as accurate for the rest of the day? or should I wait like 10 minutes after market opens for accurate readings?

[InformedTrades]

Hi, Many traders will recommend sitting out the first hour of the market, especially if you are new to the market, as this tends to be a highly volatile time in the market where it is easy to get whipsawed. This is especially true in the first 15 minutes after the open. Best Regards, Dave

[forexchemi]

Hi Dave, I found that in Bullish Pattern, you used MACD to confirm the signal of Bullish Engulfing, but in the Bearish Pattern, you didn't use any indicator to confirm that signal. So when trading with this patter, should we use any indicator to confirm that Bearish signal or is it a high reliability?

[InformedTrades]

Hi forexchemi, I don't always show the indicator confirmations just in the interest of saving time but in general I think most traders would agree that traders should always confirm trades with multiple pieces of analysis. Best Regards, Dave

[bmay1000]

i just recently started trading a practice account with Forex. your videos are absolutely easy to understand and extremely useful (particularly the 2 ways youll lose for sure vid...nailed me for sure). your work on here is amazing. thanks for taking the time to show market virgins like me the ropes.

[kedmania]

hi david again. Im sorry if I'm annoying you with yet another question, i know you must be a very busy man. how late into the day would you buy your stock on a bullish engulfing candle or would you wait for a confirming candle the next day. Also where should you place your stop loss?

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[FreeFOREXautoROBOT]

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[tradefuturesvids]

#UN#, I like your video, cool stuff

[MrLeviaFUN]

Dave, should Engulfing Candlesticks in FOREX be used during major NEWS Releases or when the market is more stable? Thanks, Great Videos !!!!!!

[laton0]

i found the best forex system

[InformedTrades]

Thanks for the comment I am glad you like it. My favorite thing to combine with any chart pattern or indicator is just simple analysis of support and resistance which I draw in on the chart by hand. With this being said to the point where the indicators you mention can help you determine how likely/unlikely a support or resistance level is to hold then yes I could see them adding value. Best Regards, Dave

[wojtek0000]

this video would be much easier to understand if you would use a pointer to point to exactly the points you are speaking of. im lost.