Engulfing definition

Engulfing is a candlestick pattern that forms when the body of one candle completely covers the body of the candle before it. It marks a sharp shift in buying or selling pressure within the chosen time period.

A bullish engulfing forms after a decline, when a strong bullish candle covers the previous bearish candle's body. A bearish engulfing forms after a rise, when a strong bearish candle covers the previous bullish candle's body.

An engulfing pattern points to a possible reversal, not a confirmed one, and it is most reliable near support, resistance, a trendline, or a major price level. It is the opposite of a harami, where the second candle sits inside the body of the first rather than covering it, and traders confirm either pattern with volume, trend direction, or momentum before acting.