The short answer

A bullish engulfing is a two-candle pattern where an up candle's real body completely covers the previous down candle's real body. After a decline, it marks a session that reversed the last one outright.

Also called: bullish engulfing candle

A bullish engulfing forming after a decline, drawn from the pattern's real open, high, low and close proportions Down candle Engulfs it

Drawn to the real proportions the formation rules describe. Lead-in candles are dimmed; the pattern itself is bracketed.

  • Traditional bias Bullish
  • Type Reversal
  • Built from Two candles
  • Context After a decline

How to spot it

  • The first candle closes below its open, continuing the decline.
  • The second candle closes above its open.
  • The second body fully contains the first body, top and bottom.
  • Bodies are compared, not wicks.
  • It follows a visible decline.

What it actually means

One session undid the previous one completely. Buyers took control from a lower open and carried price through the prior session's entire range, which requires sustained demand rather than a single burst.

What confirms it

A close above the engulfing candle's high on the next session, ideally with volume on the engulfing candle exceeding the candle it covered.

What invalidates it

A close below the engulfing candle's low, which says the demand was temporary.

Where people get it wrong

As with its bearish mirror, relative size is everything and is routinely ignored. Engulfing a very small body is close to meaningless. The pattern also appears constantly inside ranges, where there is no decline to reverse and it is simply the chart oscillating.

Common questions

Is the bullish engulfing bullish or bearish?
The traditional reading is bullish. One session undid the previous one completely. It carries that reading only after a decline.
What confirms a bullish engulfing?
A close above the engulfing candle's high on the next session, ideally with volume on the engulfing candle exceeding the candle it covered.
When does the bullish engulfing stop working?
A close below the engulfing candle's low, which says the demand was temporary. Beyond that, as with its bearish mirror, relative size is everything and is routinely ignored.

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Formation rules follow Japanese Candlestick Charting Techniques by Steve Nison. Reviewed 2026-09-14.