What is a hammer candlestick pattern?

A hammer candlestick is a technical trading pattern that resembles a “T” whereby the price trend of a security will fall below its opening price, illustrating a long lower shadow, and then consequently reverse and close near its opening. Hammer candlestick patterns occur after a downtrend. They are often considered signals for a reversal pattern.

What is a hammer candle?

The Hammer Candle is another Japanese candlestick pattern among these 35 powerful candlestick patterns. It’s a bullish reversal candlestick pattern, which indicates the end of a downtrend and the start of a new uptrend. We can most likely spot this candlestick on support levels where prices decline and show rejection from lower levels.

What does a hammer candle look like?

Long Lower Wick:- The lower wick of a hammer is at least twice as long compared to its body. No or Small Upper Wick:- The hammer candle has a very small or sometimes no upper wick. Color:- The color of the hammer candle’s body doesn’t matter, but the green color shows more power. The hammer candlestick pattern looks like this: