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Reversal Candlestick Patterns and Their Confirmation: Hammer and Hanging Man Candle Pattern - Bullish and Bearish Candlesticks

Hammer Bullish Candlestick Patterns - Hanging Man Bearish Candle Patterns

Reversal candle-stick patterns occur after an extended prior trend. Therefore, for a candle pattern to qualify as a reversal pattern there must be a prior trend.

These reversal candlestick patterns are:

  1. Hammer Candle Forex Pattern and Hanging Man Candlestick Trading Pattern
  2. Inverted Hammer Candle Pattern & Shooting Star Candle Pattern
  3. Piercing Line Candle Pattern & Dark Cloud Cover Candle Pattern
  4. Morning Star Candles & Evening Star Candles
  5. Engulfing Candles Patterns

Hammer Candle Pattern and Hanging Man Candle Pattern Candles

Hammer Candle Pattern & Hanging Man Candle Pattern candles look alike but hammer is bullish reversal pattern and hanging man is a bearish reversal pattern.

Reversal Candlestick Chart Patterns: Hammer Candlestick and Hanging Man Candles Patterns Explained

Hammer Candle Pattern and Hanging Man Candle Pattern Candles

Hammer Candlestick

Hammer is a potentially bullish pattern which occurs during a downtrend. It is named so because the market is hammering out a market bottoms.

A hammer has:

  • A small body
  • The body is at the top
  • The lower shadow is 2 or 3 times the length of the real body.
  • Has no upper shadow or very small upper shadow if present.
  • The color of the body is not important

Hammer Candlestick Reversal Chart Setups - Hammer Bullish Candles Pattern Explained

Hammer Candle

Technical Analysis of Hammer Candles Pattern

The buy signal is confirmed when a candle closes above the opening price of the candle on the left side of the hammer candle pattern.

Stop orders should be set a few pips just below low of the hammer candle.

Hanging Man Candlestick

This pattern is a potentially bearish reversal signal which occurs during a uptrend. It is named so because it resembles a man hanging on a noose up high.

A hanging man candle has:

  • A small body
  • The body is at the top
  • The lower shadow is 2 or 3 times the length of the real body.
  • Has no upper shadow or very small upper shadow if present.
  • The color of the body is not important

Forex Hanging Man Bearish Candle Setup Example Explained

Hanging Man Candle

Technical Analysis of Hanging Man Candles Pattern

Sell trading signal is confirmed when a bearish candlestick closes below the open of the candle on left-side of this hanging man candle pattern.

Stop orders should be set a few pips just above the high of the hanging man candle.