The bullish engulfing candle following the move higher last week, is accompanied by a RSI that is rising and bullish and a MACD that is about to cross up.
The bullish engulfing candle Friday gives hope that this was a quick move lower and it is ready to move up again.
We have
a bullish engulfing candle at a swing low.
The first thing to notice is how
the bullish engulfing candle closed above our key level.
Even if the daily TF has formed a bearish pinbar, the 2 hour TF is in a down trend but
the bullish engulfing candle shows a reversion to the mean.
To be a valid signal, the range of
the bullish engulfing candle must completely engulf the previous candle's range
However, the thinking at the time was that
the bullish engulfing candle is what triggered Tuesday's intraday rally.
Moving out to the weekly chart
the bullish engulfing candle for the week suggests that new all - time highs may be coming soon.
The potential Evening Star candle on Monday at the falling 20 day SMA kept the caution flags up, but they were tossed aside later in the week with
the bullish engulfing candle on Thursday and confirmed higher Friday.