There are some criteria for my personal preference.
Basically, a bearish engulfing candle with high > previous candle high is a good criteria. Same with bullish engulfing candle with low < previous candle low. So it's more like Outside Bar than standard engulfing candle.
Another factor is, how price behave (2-3 candle) before engulfing candle. If it's pretty compressed then make an engulfing candle, it's a good sign. It tells that price struggle to move to the other side, but that effort failed & price close to the opposite side.
This is how it's looks like on the chart (taken from my H1 chart USDCAD trade).
I rarely trade 2 engulfing candle, there are more factor to consider to trade 2 engulfing candle (SR, momentum, market sentiment). Besides, 2 engulfing candle usually provide less reward, because price already move to certain distance from where price turn take place. I don't say it's not trade able, but it require more factor to make it a good setup.
Sorry for my bad English.
Regards Pipmunks.
Basically, a bearish engulfing candle with high > previous candle high is a good criteria. Same with bullish engulfing candle with low < previous candle low. So it's more like Outside Bar than standard engulfing candle.
Another factor is, how price behave (2-3 candle) before engulfing candle. If it's pretty compressed then make an engulfing candle, it's a good sign. It tells that price struggle to move to the other side, but that effort failed & price close to the opposite side.
This is how it's looks like on the chart (taken from my H1 chart USDCAD trade).
Attached Image
I rarely trade 2 engulfing candle, there are more factor to consider to trade 2 engulfing candle (SR, momentum, market sentiment). Besides, 2 engulfing candle usually provide less reward, because price already move to certain distance from where price turn take place. I don't say it's not trade able, but it require more factor to make it a good setup.
Sorry for my bad English.
Regards Pipmunks.