Hammer candlestick pattern👇
The Hammer candlestick pattern is a powerful bullish reversal indicator that emerges at the bottom of a downtrend or in a bearish market. Characterized by a small real body and a long lower shadow, the Hammer signals a potential upside reversal.
Key features include:
- Formation at the bottom of a downtrend or in a bearish market
- Small real body
- Long lower shadow, at least twice the length of the real body
- Color can be green or red, with bullish implications remaining the same
The Hammer candle indicates:
- Sellers initially pushed prices lower, but buyers regained control and drove prices back up
- Strong demand exists at the current price level
- A potential upside reversal is likelyTraders often consider the Hammer candle a buy signal, especially when combined with other technical indicators or chart patterns.