A hammer candlestick pattern forms at the bottom of a bearish market and signals a potential reversal. However, it requires confirmation in the form of a subsequent bullish candlestick like a bullish candle or dragonfly doji. Stronger confirmation comes from the hammer forming at a support level. A hanging man pattern is similar but forms at the top of a bullish market and also signals a potential reversal if followed by a bearish candlestick confirmation.
A hammer candlestick pattern forms at the bottom of a bearish market and signals a potential reversal. However, it requires confirmation in the form of a subsequent bullish candlestick like a bullish candle or dragonfly doji. Stronger confirmation comes from the hammer forming at a support level. A hanging man pattern is similar but forms at the top of a bullish market and also signals a potential reversal if followed by a bearish candlestick confirmation.
A hammer candlestick pattern forms at the bottom of a bearish market and signals a potential reversal. However, it requires confirmation in the form of a subsequent bullish candlestick like a bullish candle or dragonfly doji. Stronger confirmation comes from the hammer forming at a support level. A hanging man pattern is similar but forms at the top of a bullish market and also signals a potential reversal if followed by a bearish candlestick confirmation.
market(@bottom). It is a market(@bottom). It is a reversal signal, however it is reversal signal, however it is or not that strong and it or not that strong and it needs confirmation which is a needs confirmation which is a bullish candle or dragonfly bullish candle or dragonfly Hammer doji(might be not immediate Hammer doji(might be not immediate (body color candle may be 2nd or 3rd (body color candle may be 2nd or 3rd doesn’t matter) candle). Another confirmation doesn’t matter) candle). Another confirmation is is the formation at support the formation at support level level Note:- Longer the lower Note:- Longer the lower shadow of the hammer and shadow of the hammer and the body of the confirmation the body of the candle, the stronger the confirmation candle, the reversal signal. stronger the reversal Hanging Man is a hammer signal. candlestick that forms on a Hanging Man is a hammer bullish market(@ top). Hanging candlestick that forms on a man forms after some bullish bullish market(@ top). candles and it is considered as Hanging man forms after a reversal signal on a bullish some bullish candles and it is market. considered as a reversal signal The confirmation on a bullish market. candle has to be a The confirmation bearish candle. The candle has to be a bigger the bearish bearish candle. The body of the bigger the bearish confirmation candle, body of the the stronger the confirmation candle, reversal signal. the stronger the Resistance Level reversal signal. should be checked Resistance Level Note:-If the after should be checked candle formed is Note:-If the after bullish then the candle formed is trend continues and bullish then the is not reversal trend continues and Larger gap between is not reversal the Hanging man and Larger gap between the next candlestick is the Hanging man and one of the the next candlestick is confirmations. one of the The gravestone after confirmations. hanging man is a very The gravestone after strong downward hanging man is a very signal strong downward signal