Bearish engulfing pattern could accelerate even more to the downside
How to tell if a stock might be about to start a bear market? One method that comes from Japanese candlesticks is that of the bearish engulfing pattern. The pattern consists of a bullish candlestick followed by a bearish candlestick encompassing the smaller bullish candlestick. The pattern can be important because it shows that the sellers have outnumbered the buyers and are pushing the price more aggressively down than the buyers have been able to push it up. Applying this method we have seen that a powerful bearish signal hit these stocks; Anima Holding and Saes Getters. It should be noted that to avoid the noise that can arise from another volatility associated with low trading, we have only considered stocks whose one-month average of the value traded is greater than €500,000 per day.
The graphic situation of the Anima Holding stock
The title Soul Holding (MIL:ANIM closed the session of 10 February at 3.88 euros, down by 3.15% compared to the previous session.
Bearish cross of the averages for Anima Holding shares – projections of the stock market
The bearish engulfing sell signal pattern is only the epilogue of a series of attempts that in the previous days had anticipated the arrival of the decline. Let’s think about the sell signal arrived from the RSI and that of the SwingTrading Indicator. Note that the signal of the bearish engulfing pattern was accompanied by a bearish crossing of the averages. Then, a powerful bearish signal hit these stocks. At this point, the quotations could end up at €3.74 in the area
Saes Getters and the indications of graphic analysis
The title Saes Getters (MIL:SG) closed the February 10 session at €32.00, down 2.14% on the previous session.
The averages resist crossed to the upside, but the first signs of yielding are visible clarifications
We could say that the sell signal of the bearish engulfing pattern was anticipated a few days ago, when we asked to pay attention to the possible descent of Saes Getter. At this point the the probability that it can accelerate downwards is very high. A confirmation in this sense could come from the break of the support in the €31.20 area. In this case, the quotations could drop to the €28.6 area first, and then the €26.10 area.
If, on the other hand, the support were to resist, it could be an excellent point from which to start again.
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