A "Bearish Engulfing Pattern" is a technical chart pattern that signals lower prices to come. The pattern consists of an up (white or green) candlestick followed by a large down (black or red) candlestick that eclipses or "engulfs" the smaller up candle. The pattern can be important because it shows sellers have overtaken the buyers and are pushing the price more aggressively down (down candle) than the buyers were able to push it up (up candle).The bearish engulfing formation typically occurs after an advance, suggesting that selling pressure is increasing and likely to push prices lower in the near future. This formation should not be used as a sole indicator, but rather in conjunction with other technical indicators and analysis for confirmation.
