1. What is bearish engulfing the K-line?
Bear engulfing means that the Yin line entity on the right completely covers the Yang line entity on the left, which is also called Yang Yinbao.
The pattern of short engulfment reflects that the stock price was originally on the rise, but later a firm entity appeared, engulfing the previous entity. Explain that the market has overwhelmed many parties. The market outlook may end the rising market and turn down.
K-line in the form of short engulfment (Figure):
Second, what does it mean to see a bearish K-line?
1. The bear market engulfing pattern appears in an obvious upward trend. If the engulfing pattern has some reference elements and features listed below, the possibility that they constitute an important inversion signal will be greatly increased:
2. In the bearish engulfing pattern, the entity on the first day is very small, while the entity on the second day is very large. This situation may indicate that the driving force of the original trend is fading, while the potential power of the new trend is growing.
3. The bear market engulfing pattern appears after the ultra-long-term or very intense market movement. If there is an ultra-long-term upward trend, it increases the possibility of potential buyers entering the market to buy and hold long positions. In this case, the market may lack sufficient supply of new long positions to continue to push the market up. If there is a very violent market movement, the market may go too far in one direction and be easily hit by shorts.
4. In the form of bear market engulfment, the second entity is accompanied by excessive trading volume. This situation may belong to the phenomenon of huge shipment explosion.
5. In the form of bearish engulfment, more than one entity was swallowed forward the next day.