''Candles might help light the way.'' :- Steve Nison 1. HDFC BANK was moving beautifully in an upward parallel channel. 2. At the level of 1640-1650 price, Stock faced resistance thrice, then the price started moving in the downward parallel channel in the tight price range. 3. Stock then broke both parallel channels then fall to the price level of 1352. 4. Stock price then halt and took the support at the strong support level. 5. Stock price took the support of 200 DEMA. 6. Stock Price formed Bullish Engulfing Pattern, which suggests that now Bears has now exhausted, and Bulls has taken control. 7. Volume states that the greater the volume, the greater the force behind the. last 10 days volume is increasing, and the delivery percentage is average <50%, which suggests that investors are taking an interest.
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TRADING_DUNIYA
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this is not a engulfing ..... wrong engulfing
udaysathe35
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@pranayminsu, yes it is not perfect engulfing should cover from bottom wick top wick of previous candle
Harshit_bhadoriya
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@pranayminsu, @udaysathe35 what does wrong engulfing mean? Technical analysis is more of an art than a science. As the tumb rule of TA, one needs to be flexible with the candlestick chart. we should not expect the real-world examples to always match their ideal formations.
let's come to the textbook definition of the Bullish engulfing pattern, two comprise the engulfing pattern. the second real body must engulf the prior real body ( it need not engulf the shadows).
in the case of this HDFC BANK chart, the previous day's close was 1367.05 and the next day's opening was 1368.00 ( this minor difference can be adjustable in technical analysis. The previous day's opening was 1393.00 and the next day's closing was 1400.35. this clearly shows that this is engulfing pattern.
kindly tell me what wrong with this?
TRADING_DUNIYA
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@Harshit_bhadoriya, body of red candle should be engulfed body of green candle perfectly... But yeah this is another candlestick pattern it's ur duty to correct yourself
Harshit_bhadoriya
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@pranayminsu Dear, I am agreed with your point. as Technical analysis suggests, we have to be flexible with the candlestick chart pattern.
udaysathe35
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@Harshit_bhadoriya, I mean it is not perfect engulfing but as it is at strong support level we can consider it as i can see bullish candle slightly covered the previous candle if it is covering more there is more chances of strong reversal of trend by the way Good analysis.
Harshit_bhadoriya
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@udaysathe35, absolutely correct. I totally agreed with your point. And thank you for appreciating my work.
AvinashMudaliar
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@pranayminsu, Dude you need to see candlestick psychology, See the Volume and Candle anomaly, See the Support Structure and then that Green Candle which is engulfing previous close. Don't get stuck by expecting exact textbook stuff and exact text book names, Names of candlestick doesn't mean much in analysis.