Bullish Engulfing

A chart pattern that forms when a small black candlestick is followed by a large white candlestick that completely eclipses or "engulfs" the previous day's candlestick. The shadows or tails of the small candlestick are short, which enables the body of the large candlestick to cover the entire candlestick from the previous day. If not much volume occurs on the 1st day of the Bullish Engulfing formation compared to the 2nd day, then this increases the strength of the pattern. The 2nd day opens below the close of the 1st day, however quickly rallies to close above the open of the 1st day. This damages the spirits of the shorts and brings into question the bear trend which prompts additional buying in the coming days.

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