Types of Hammer Candlestick Pattern - Hammer Bullish Candlestick Pattern - Reversal Candle Patterns

Hammer Bullish Candlestick Patterns - Reversal Candlestick Chart Patterns

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

These reversal candlestick patterns are:

1. Hammer Candles Pattern & Hanging Man Candle Pattern
2. Inverted Hammer Candles 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 Candlesticks Pattern and Hanging Man Candle Pattern Candlesticks

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

Hammer Candlesticks Pattern and Hanging Man Candlestick Pattern Candles

Hammer Candlesticks Patterns

Hammer is a potentially bullish pattern which occurs during a forex 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 Candles

Technical Analysis of Hammer Candles Patterns

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

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

Inverted Hammer Bullish Candlestick Patterns - Reversal Candlestick Chart Patterns

Inverted Hammer Candlesticks Pattern & Shooting Star Candle Pattern candlesticks look alike. These have a long upper shadow and a short body at the bottom. Their color does not matter. What matters is the point where they appear whether at the top of a market trend (star) or the bottom of a market trend (hammer).

The difference is that inverted hammer is a bullish reversal candlestick pattern while shooting star is a bearish reversal candle pattern.

Upward Trend Reversal - Shooting Star Candlesticks

Downward Trend Reversal - Inverted Hammer Candlesticks

Inverted Hammer Candlesticks Pattern & Shooting Star Candle Pattern Candles Chart Patterns

Inverted Hammer Forex Candle

This is a bullish reversal candle stick pattern. It forms at the bottoms of a Forex trend.

Inverted hammer occurs at the bottom of a downtrend and indicates the possibility of reversal of the downward Forex trend.

Inverted Hammer Forex Candle

Technical Analysis of Inverted Hammer Forex Trading Candle

A buy is completed when a candle-stick closes above neckline, this is opening of the candle on left side of this pattern. The neck line level in this acts as a resistance zone.

Stop orders for the buy trades should be set a few pips below lowest price on the recent low.

An inverted hammer is named so because it signifies that the market is hammering out a bottoms.