How to Read a Bearish Engulfing Pattern
A small bullish candle followed by a larger bearish candle that swallows it whole -- often an early sign a rally has lost control.
CANDLESTICK PATTERNS
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2-candle pattern · Bearish reversal
A bearish engulfing pattern is a small bullish candle followed by a larger bearish candle that completely covers its body. Appearing after an uptrend, it shows sellers overwhelmed the prior session’s gains in one move, which is why it’s often read as an early sign a rally has lost control to sellers.
As with its bullish counterpart, a bearish engulfing pattern is generally treated as more significant near an existing resistance level and when the engulfing (bearish) candle trades on heavier volume than the one it swallows. A bearish engulfing candle that forms on unusually thin volume is more often just noise inside a still-intact uptrend.
Related patterns
- How to Read a Bullish Engulfing Pattern
- How to Read a Dark Cloud Cover Pattern
- How to Read a Bearish Harami
- How to Read a Three Outside Down Pattern
This article is educational only and isn’t a recommendation to trade any particular instrument or pattern — no candlestick pattern works in isolation. See the full candlestick guide for how patterns like this one fit into a broader approach.