Videos
Japanese candlesticks have one ability that most other chart types don’t – they can show so called “engulfing” patterns. An engulfing pattern is defined as when the open and close price of a bullish or bearish candle are within the range of the open and close price of the candle following them.

When this happens many traders believe it is a sign that a trend has just finished and this is the best possible entry point. That’s the theory but as we know the market doesn’t always answer to predefined rules.

That’s why David Jones includes real examples alongside the theory behind these specific chart patterns. You’ll also see different time frames discussed in terms of how often engulfing candles can happen, as this is an important factor when deciding if you should trust the pattern in different situations.

At Trading 212 we provide an execution only service. This video should not be construed as investment advice. Investments can fall and rise. Capital at risk. CFDs are higher risk because of leverage.

Articles You May Like

Bank stocks jump almost 12% as traders bet on less regulation in a Trump presidency
Global ETFs slide as investors see Trump tariff policies hurting trade
Trump and Harris both head to Pennsylvania in campaign’s final leg
Election could mean new leaders for key Congressional committees
The Federal Reserve cuts interest rates by a quarter point after election. Here’s what that means for you