Hdfc Bank

The Bearish Engulfing pattern is a two-candlestick reversal pattern that typically signals a potential trend reversal from an uptrend to a downtrend. It is a strong bearish signal, especially when it forms after a prolonged upward movement. Key Characteristics of a Bearish Engulfing Pattern: Formation: The first candle is bullish (green or white) with a small real body. The second candle is bearish (red or black) with a large real body that completely engulfs the body of the first candle (not necessarily the shadows). Trend Context: Must occur after an uptrend or a strong upward move to be valid. Psychology: The first candle continues the bullish trend. The second candle opens higher or at the same level but then sells off sharply, closing below the prior candle's open, showing that bears have taken control.