Bullish Engulfing Pattern: Shape, Meaning, and Examples on Crypto Charts
Schematic of the Bullish Engulfing shape. What matters is the proportion of body and wicks, not the price figures.
Bullish Engulfing pattern shape
- The first candle is down, with a body thick enough to count.
- The second candle is up and opens no higher than the first candle's close.
- The second candle closes no lower than the first candle's open, so its body engulfs the previous body.
General meaning
Two consecutive periods that cancel each other out: the entire down move of the first candle is erased by the second. What it records is a change of control across two periods, judged purely by the candle bodies without counting the wicks.
Where it usually appears
Often appears after a run of shrinking down candles, at price areas that previously held declines, and on the first candle after news that surprises the market.
Worth noting. Relative size matters: a second body that only barely engulfs the first appears far more often and is weaker. CryptoHalley assigns strength 3 when the second body is at least 1.6 times the first.
See live detection on the chart
The CryptoHalley chart engine marks Bullish Engulfing automatically with id bullish_engulfing, no extra indicator needed. Open the chart and browse the labeled candles.
FAQ
- Do the wicks count in an engulfing pattern?
- No. Only the bodies are compared, i.e. the distance from open to close. The second candle can have wicks that don't exceed the first candle's wicks and still count as engulfing.
- How is it different from the piercing line pattern?
- A piercing line only cuts through more than half of the previous candle's body, while an engulfing swallows all of it. CryptoHalley's engine currently marks only full engulfing patterns, not piercing lines.
- Is this pattern more meaningful on certain timeframes?
- On higher timeframes the pattern is much rarer, because one daily candle engulfing the previous daily candle means a full day erasing the day before. On the one-minute timeframe the same pattern shows up dozens of times a day.