Engulfing Pattern

Hello,

Is this still classed as an engulfing pattern?

44

True engulfing patterns rarely happen in forex charts because they rely on an open at a different level to the prior close. This is rare and is somewhat random anyway because forex trading proceeds on a mostly 24-hour basis. Engulfing patterns and many orthodox candlestick patterns rely on a uniform close at the same time, with a period of the clock when there is no trading.

So be very cautious about using such patterns in forex.

This never really answered my question but thanks lol

Its not a true engulfing pattern. Its unlikely to produce as good results as a true engulfing pattern should. You could still use it as a basis for trade entry and stop-loss positioning but maybe a little extra caution would be appropriate.

1 Like

Thank you! I like this explantation. I did use this pattern as an entry and it has provided good results so far! I will continue to be cautions though…

1 Like