Stock Market Update: 3 Stocks that can give strong gains backed by bullish candlestick formation

Equity tips:-
Candlesticks are the most popular chart choice among traders as compared to line chart, bar chart and the point & figure chart. It has gained popularity among the traders as it conveys the wide range of trading information in one go in a highly visual way.

Candlesticks tend to form patterns which are interpreted by traders to identify a continuation or reversal of the existing trend. It is also used to spot short-term trading opportunities. Different traders make use of candlestick charts differently. Candlestick patterns should be used in conjunction with the prevailing trend.
Candlestick also tends to act as a unique leading indicator providing the trader with an edge while entering and exiting a trade. It also gives an early signal of a reversal in trend compared to the rest of the technical indicators. Hence it is widely used in short-term trading and in volatile markets.
Candlestick patterns gain significance based on their location within the trend.



Bullish Engulfing

Definition


This pattern is characterized by a large blue body engulfing a prior smaller red body, which appears during a downtrend. The blue body does not have to engulf the shadows of the prior candle but it totally engulfs the body.


Candlestick Pattern Interpretation


While the market is characterized by a downtrend, selling is observed with the occurrence of a red body on the first day but with light volumes. The next day, the market opens lower. It looks as if there’s going to be a continuation of the bearish trend, however, the selling pressure loses momentum and the bulls gain control during the day. The buying force overcomes the selling force and in the end, markets managed to close above the open of the prior day.


Following is the list of stocks that are expected to trade with a positive bias, backed by a formation of Bullish Engulfing candlestick pattern on the daily chart: 

ScripStock PriceCandlestick PatternView
Bajaj Finserv6439.05Bullish EngulfingBullish
HDFC Bank2122.35Bullish EngulfingBullish
Ultratech Cement3996.1Bullish EngulfingBullish
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