Breakout is happening – Price successfully breaks through resistance.
Bearish Engulfing formed – The red candle is larger, engulfing the previous green candle, signaling potential reversal.
Price retraces to the engulfing zone – Price rises back to the original engulfing area.
Price rejects and drops – Price fails to push higher and continues to fall.
The engulfing zone becomes a new resistance – Traders use this zone as a reference for entry to short after rejection.
#lerning