Reversal Candlestick Patterns and Their Confirmation: Hammer and Hanging Man Candlestick Pattern - Bullish and Bearish Candlesticks
Hammer Bullish Candlestick Patterns - Hanging Man Bearish Candlestick Patterns
Reversal candlestick patterns occur after an extended prior trend. Therefore, for a candlestick pattern to qualify as a reversal pattern there must be a prior trend.
These reversal candlestick patterns are:
- Hammer Candlestick Pattern and Hanging Man Candlestick Pattern
- Inverted Hammer Candlestick Pattern and Shooting Star Candlestick Pattern
- Piercing Line Candlestick Pattern and Dark Cloud Cover Candlestick Pattern
- Morning Star Candlesticks and Evening Star Candlesticks
- Engulfing Candlesticks Patterns
Hammer Candlestick Pattern and Hanging Man Candlestick Pattern Candlesticks
Hammer Candlestick Pattern and Hanging Man Candlestick Pattern candlesticks look alike but hammer is bullish reversal pattern and hanging man is a bearish reversal pattern.
Hammer Candlestick Pattern and Hanging Man Candlestick Pattern Candlesticks
Hammer Candlestick
Hammer is a potentially bullish pattern that occurs during a forex downtrend. It is named so because the market is hammering out a market bottom.
A hammer has:
- A small body
- The body is at the top
- The lower shadow is two or three 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
Technical Analysis of Hammer Candlesticks Pattern
The buy signal is confirmed when a candlestick closes above the opening price of the candlestick on the left side of the hammer candlestick pattern.
Stop orders should be place a few pips just below the low of the hammer candlestick.
Hanging Man Candlestick
This pattern is a potentially bearish reversal signal that occurs during a forex uptrend. It is named so because it resembles a man hanging on a noose up high.
A hanging man candlestick has:
- A small body
- The body is at the top
- The lower shadow is two or three 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
Hanging Man Candlestick
Technical Analysis of Hanging Man Candlesticks Pattern
The sell signal is confirmed when a bearish candlestick closes below the open of the candlestick on the left side of this hanging man candlestick pattern.
Stop orders should be place a few pips just above the high of the hanging man candlestick.
