Indication : reversal
Reliability : Medium
DescriptionOccurring during an uptrend, this pattern characterized by a large black real body, which engulfs a white real body (it doesn't need to engulf the shadows). This signifies that the uptrend has been hurt and the bears may be gaining strength. The indicator is also the first two candles of the Three Outside patterns.
It is a major reversal signal.
Factors that are increasing this signal's reliability:
1) The first has a very small real body and the second a very large real body.
2) The pattern appears after a protracted or very fast move.
3) Heavy on the second black .
4) The second engulfs more than one real body.