For example, consider a bullish engulfing pattern, occurring within a downtrend. Apparently, this shows that "buying pressure has overwhelmed selling pressure". What I don't understand is why the second candlestick has to engulf the first candlestick? Surely Any strong move in the opposite direction of the trend should be as valid as an engulfing pattern?
For example, consider the following scenarios:
Figure A is a bullish engulfing pattern which, apparently, shows that buying pressure has overwhelmed selling pressure. Figure B is not an engulfing pattern, but surely it also shows buying pressure overwhelming selling pressure?
For example, consider the following scenarios:
Figure A is a bullish engulfing pattern which, apparently, shows that buying pressure has overwhelmed selling pressure. Figure B is not an engulfing pattern, but surely it also shows buying pressure overwhelming selling pressure?