Mastering candlestick patterns and incorporating them into proven, backtested trading strategies can be a powerful addition to your trading toolbelt. This week, I’m sharing insights into two powerful candlestick patterns and introducing a model portfolio designed to help you achieve smooth, consistent returns with minimal market risk.

Let’s dive in.

1. Master the Bullish Engulfing Candlestick Pattern

The Bullish Engulfing pattern signals a potential reversal from a downtrend to an uptrend. It’s a two-candle formation where a small bearish candle is followed by a larger bullish candle that completely engulfs the previous candle’s body. This pattern highlights a shift in market sentiment, indicating that buyers have taken control.

Key takeaways include:

  • How to identify the Bullish Engulfing pattern.
  • Why it signals a potential reversal.
  • How systematic traders use this pattern to time their entries.
Master the bullish engulfing candlestick pattern

2. Spot Bearish Reversals with the Bearish Engulfing Pattern

The Bearish Engulfing pattern is a two-candle reversal signal that typically forms after an uptrend. It shows that selling pressure has overtaken buying pressure, suggesting a potential downward movement.

Here’s what you’ll learn:

  • How to recognize the Bearish Engulfing pattern.
  • When to expect a bearish reversal.
  • Risk management tips for using this pattern in your trades.
Spot bearish reversals with the bearish engulfing pattern

Trading Tip of the Week

Successful trading isn’t about guessing where the market will go next—it’s about recognizing patterns, managing risk, and following a tested process. Candlestick patterns, like Bullish and Bearish Engulfing, are key tools for spotting potential reversals and making informed decisions.

However, the true power of trading comes from using these insights systematically. Many traders struggle because they react emotionally to market noise. Instead, focus on a disciplined approach: backtest your strategies, follow objective rules, and diversify your portfolio to withstand various market conditions.

Remember, even the most successful traders don’t win every trade. What sets them apart is consistency, discipline, and the ability to stick to their plan, no matter what the market throws at them.

As you refine your trading in 2025, aim to combine technical knowledge with a systematic approach. This will help you navigate market volatility with confidence and achieve steady growth over time.

Quote of the Week:

“The best traders don’t predict—they prepare. A strong system and steady discipline will outlast market noise every time.”

Simplify Your Trading with the Ultimo Standard ETF Model Portfolio

The Ultimo Standard ETF Model Portfolio is a short-term seasonal strategy that leverages the Ultimo Effect—a powerful seasonal edge combined with mean reversion principles. It’s ideal for traders looking for consistent returns without the stress of long holding periods.

What makes Ultimo stand out:

  • Trades US Indices & Bonds — A diversified, low-risk approach.
  • Daily Signals — Actionable trades sent directly to your inbox.
  • High Win Rate — Proven success with a 66% win rate.
  • Short Holding Periods — Average trades last just 5.4 days.
  • Smooth, Consistent Returns — Compound annual return of 15% (unleveraged) and up to 32% with leverage.

Ready to take the guesswork out of your trading? The Ultimo Model Portfolio provides reliable, high-win-rate strategies to help you achieve steady returns in any market condition.

Simplify your trading with the ultimo standard etf model portfolio

Overcoming Job-Related Trading Restrictions

In this video, I share real-world examples of traders who have successfully worked within tight restrictions, like limited transactions per month or bans on certain markets. You’ll learn actionable tips to thrive despite limitations, including:

  • Exploring international markets and cryptocurrencies.
  • Designing personalized trading systems to align with your constraints.
  • Implementing strategies to maximize your returns under restrictions.
Overcoming job-related trading restrictions

Remember – You are only one trading system away!

Adrian Reid

Founder, Enlightened Stock Trading

 

PS: The right strategy can transform your trading results. Join the Ultimo Standard ETF Model Portfolio and start seeing consistent, smooth returns with actionable signals sent straight to your inbox.

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Adrian Reid Founder and CEO
Adrian is a full-time private trader based in Australia and also the Founder and Trading Coach at Enlightened Stock Trading, which focuses on educating and supporting traders on their journey to profitable systems trading. Following his successful adoption of systematic trading which generated him hundreds of thousands of dollars a year using just 30 minutes a day to manage his system trading workflow, Adrian made the easy decision to leave his professional work in the corporate world in 2012. Adrian trades long/short across US, Australian and international stock markets and the cryptocurrency markets. His trading systems are now fully automated and have consistently outperformed international share markets with dramatically reduced risk over the past 20+ years. Adrian focuses on building portfolios of profitable, stable and robust long term trading systems to beat market returns with high risk adjusted returns. Adrian teaches traders from all over the world how to get profitable, confident and consistent by trading systematically and backtesting their own trading systems. He helps profitable traders grow and smooth returns by implementing a portfolio of trading systems to make money from different markets and market conditions.