Bearish Engulfing - Long Wick

Beginner Questions
1

I have started to learn Price action. Can we consider a candle with a long wick and a small body as Bearish Engulfing?
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2

Techincally speaking yes as by definition it is the body that is engulfed and not the shadow.

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3

This demonstrates the weakness of patterns like engulfing bullish and engulfing bearish when applied to forex D1 charts and all intra-day charts and illustrates the unexpected failure of many TA trades. There is no “overnight” or time-determined gap. Although the chart might show a small gap between the open of the latest bar and the the body of the prior bar, this is due to random chance of timing - the gap is not a real indicator of anything as there is only the tiniest and random interval between the two consecutive bars.

Use engulfing patterns only on D1 charts on a market with a closed session.

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4

I think you’re really reaching here, I would not consider that a bearish engulfing candle. And like Tommor mentioned regarding gaps, this looks like a stock chart as opposed to a forex chart.

I would stick with more obvious signals at first, and keep track of them in a journal, that way in a few months you’ll be able to pick out what works and what doesn’t so much.

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5

I think overly large wicks are a signal of noise rather than anything else.

It’s the presence of a real body and it’s relation to the bar prior to it that gives more meaning in my experience.

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6

Thanks, everyone for your responses. @Johnscott31 @MattyMoney @tommor @cashisking86. I read somewhere that we should ignore the shadows for reversal candle stick patterns?

7

@tommor, D1, TA means?

8

This is incorrect. Do not ignore the shadows or wicks on a candlestick chart. The three most important prices that occur on a chart are the daily close, the daily high and the daily low.

D1 means a daily chart, on which the bars or candles represent a period of 1 day.

TA is Technical Analysis, the practice if using price charts to determine trading decisions.

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9

Thank you @tommor. Can you guide me to learn TA?

This is what I’ve learned till now.

  1. Drawing Support and Resistance
  2. Identifying trend at support/resistance with reversal candle patterns
10

Pipsology has a section on TA. Try there. Lots of info.

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11

As far as I know, a candlestick with no shadow is seen as a strong signal of conviction by either buyers or sellers as per the direction of the candle. But the shadow on a candlestick pattern determines where the price of the stock has fluctuated in accordance with opening and closing prices.