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What is Hammer in cryptocurrency

In the context of cryptocurrency, "hammer" could refer to a type of candlestick pattern used in technical analysis. A hammer candlestick has a small body near the top of the trading range and a long lower wick, resembling a hammer. It often signals a potential reversal from a downtrend to an uptrend, especially if it occurs after a significant price decline. Traders may interpret it as a bullish signal.

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Impact of hammer on cryptocurrency

The impact of a hammer candlestick pattern on cryptocurrency depends on various factors, including the market conditions, timeframe, and other technical indicators.

In general, when a hammer candlestick forms after a downtrend, it can indicate that selling pressure has exhausted, and buyers are stepping in to push the price higher. This can potentially lead to a reversal or a temporary bounce in the price of the cryptocurrency. However, it's essential to consider other factors such as volume, market sentiment, and the overall trend before making trading decisions solely based on the hammer pattern.