How to recognize it
- Appears after an advance.
- The first candle is long and bullish.
- The second candle opens above the first candle's close (classically above its high), then closes below the midpoint of the first body, but above the first open.
What it suggests
The session opened with fresh optimism, but sellers took over and erased more than half of the previous session's gain.
Where it matters
Stronger the deeper the second close reaches into the first body, and at resistance. A close below the first open would make it a bearish engulfing.
Educational content only. Candlestick patterns describe past price action. They do not predict future prices, and they are not trading signals or investment advice. Prices in the diagrams are illustrative.