The Bearish Engulfing is a two-candle pattern at the top of an uptrend. The first candle is bullish (green); the second is a large bearish (red) candle whose real body completely engulfs the first candle's real body — the mirror of the Bullish Engulfing.
Bears overwhelm bulls completely in a single session — a decisive shift in control. The engulfing candle wipes out all of the previous session's gains and pushes further below. This signals that selling pressure has overtaken buying pressure at this price level, often marking a significant top.
Especially powerful at resistance levels, prior swing highs, or during overbought conditions (RSI above 70). Expect -4–9% over the next 5–12 days. Pattern is self-confirming — enter on the close of the engulfing candle.
Example Chart
Large red body fully engulfs the prior green body