Hidden Engulfing Pattern with Two- and Three-Bar Breaks

Summary

The document describes a bullish candlestick setup called Hidden Engulfing and distinguishes two versions by the number of intervening harami candles. In the two-bar-break version, a bullish candle closes above the open of a preceding bearish candle, with at least one harami candle between them. The three-bar-break version uses the same close condition but requires at least two intervening harami candles.

The document gives pattern definitions only; it provides no chart examples, market context, entry or exit rules, performance evidence, or risk guidance. It therefore explains how to identify the described formations but does not establish whether they predict price direction or how they should be traded.

Key ideas

• The setup begins with a bearish candle and ends with a bullish candle closing above the bearish candle’s open.
• The two-bar-break variation requires at least one harami candle between the bearish and bullish candles.
• The three-bar-break variation requires at least two intervening harami candles.
• The description provides no evidence about predictive value or trading performance.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.