𝑯𝒂𝒎𝒎𝒆𝒓 𝒄𝒂𝒏𝒅𝒍𝒆𝒔𝒕𝒊𝒄𝒌 𝒑𝒂𝒕𝒕𝒆𝒓𝒏- 𝒂 𝑩𝒖𝒍𝒍𝒊𝒔𝒉 𝒓𝒆𝒗𝒆𝒓𝒔𝒂𝒍 𝑪𝒂𝒏𝒅𝒍𝒆𝒔𝒕𝒊𝒄𝒌 𝒑𝒂𝒕𝒕𝒆𝒓𝒏:
𝗝𝗼𝗶𝗻 𝗼𝘂𝗿 𝘁𝗲𝗹𝗲𝗴𝗿𝗮𝗺 𝗰𝗵𝗮𝗻𝗻𝗲𝗹 𝘁𝗼 𝗹𝗲𝗮𝗿𝗻 𝘁𝗵𝗲 𝘀𝘁𝗼𝗰𝗸 𝗺𝗮𝗿𝗸𝗲𝘁 𝗯𝗮𝘀𝗶𝗰𝘀- 𝗙𝗶𝗻𝘄𝗶𝗻𝗴𝘀 𝗦𝘁𝗼𝗰𝗸 𝗧𝗿𝗮𝗱𝗶𝗻𝗴 𝗔𝗰𝗮𝗱𝗲𝗺𝘆~ 𝗙𝗿𝗲𝗲 𝗘𝗱𝘂𝗰𝗮𝘁𝗶𝗼𝗻𝗮𝗹 𝗖𝗵𝗮𝗻𝗻𝗲𝗹:
𝐂𝐚𝐧𝐝𝐥𝐞𝐬𝐭𝐢𝐜𝐤𝐬 𝐚𝐫𝐞 𝐮𝐬𝐞𝐝 𝐛𝐲 𝐬𝐰𝐢𝐧𝐠 𝐭𝐫𝐚𝐝𝐞𝐫𝐬, 𝐝𝐚𝐲 𝐭𝐫𝐚𝐝𝐞𝐫𝐬, 𝐢𝐧𝐯𝐞𝐬𝐭𝐨𝐫𝐬, 𝐚𝐧𝐝 𝐟𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐢𝐧𝐬𝐭𝐢𝐭𝐮𝐭𝐢𝐨𝐧𝐬:
- They are easy to comprehend.
- Patterns are easy to identify.
- They can be used in conjunction with other Indicators.
- Provide a much more detailed description of the occurrences and happenings in the market, and interactions between buyers and sellers as compared to traditional charts which provide minimal information
𝑰𝑴𝑷𝑶𝑹𝑻𝑨𝑵𝑪𝑬 𝑶𝑭 𝑪𝑨𝑵𝑫𝑳𝑬𝑺𝑻𝑰𝑪𝑲𝑺 𝑷𝑨𝑻𝑻𝑬𝑹𝑵𝑺
- They allow us to understand the sentiment of Investors and the values being determined by the market.
- They indicate market turning points early and estimate the direction of the market.
- Overall, Candlesticks provide unique insights.
- They display reversal patterns which cannot be seen in other types of charts.
- They can be used in all kinds of markets.
- Candlestick Patterns are highly accurate in predicting market trends.
𝐖𝐡𝐚𝐭 𝐢𝐬 𝐚 𝐇𝐚𝐦𝐦𝐞𝐫 𝐂𝐚𝐧𝐝𝐥𝐞𝐬𝐭𝐢𝐜𝐤 𝐩𝐚𝐭𝐭𝐞𝐫𝐧? – 𝐀 𝐁𝐮𝐥𝐥𝐢𝐬𝐡 𝐑𝐞𝐯𝐞𝐫𝐬𝐚𝐥 𝐩𝐚𝐭𝐭𝐞𝐫𝐧 𝐚𝐭 𝐭𝐡𝐞 𝐞𝐧𝐝 𝐨𝐟 𝐚 𝐦𝐢𝐧𝐨𝐫 𝐝𝐨𝐰𝐧𝐭𝐫𝐞𝐧𝐝 𝐢𝐧 𝐚𝐧 𝐨𝐯𝐞𝐫𝐚𝐥𝐥 𝐩𝐫𝐢𝐦𝐚𝐫𝐲 𝐔𝐏 𝐭𝐫𝐞𝐧𝐝.
𝑰𝒏𝒕𝒆𝒓𝒑𝒓𝒆𝒕𝒂𝒕𝒊𝒐𝒏 𝒐𝒇 𝒕𝒉𝒆 𝒉𝒂𝒎𝒎𝒆𝒓 𝒄𝒂𝒏𝒅𝒍𝒆𝒔𝒕𝒊𝒄𝒌 𝒑𝒂𝒕𝒕𝒆𝒓𝒏👇👇
- The Lower shadow should be at least twice the length of the body.
- Trend should be down for a good period.
- The color of the small body is not important.
- There should be no upper shadow or a very small upper shadow.
- Large volume on the Hammer day increases the chances that a blow-off day has occurred.
- For Confirmation if the market opens Gap Up or sustain above the body.
- Stop loss will be below the low of Hammer.
- Target 1:2 Ratio minimum for more modified stop-loss from time to time.
𝑾𝒉𝒆𝒏 𝒂 𝑯𝑨𝑴𝑴𝑬𝑹 𝒄𝒂𝒏𝒅𝒍𝒆𝒔𝒕𝒊𝒄𝒌-𝒍𝒊𝒌𝒆 𝒑𝒂𝒕𝒕𝒆𝒓𝒏 𝒊𝒔 𝒊𝒅𝒆𝒏𝒕𝒊𝒇𝒊𝒆𝒅, 𝒂 𝒇𝒐𝒍𝒍𝒐𝒘-𝒖𝒑 𝒃𝒖𝒚𝒊𝒏𝒈 𝒑𝒓𝒆𝒔𝒔𝒖𝒓𝒆 𝒔𝒉𝒐𝒖𝒍𝒅 𝒃𝒆 𝒘𝒊𝒕𝒏𝒆𝒔𝒔𝒆𝒅. 𝑰𝒇 𝒕𝒉𝒆𝒓𝒆 𝒊𝒔 𝒏𝒐 𝒃𝒖𝒚𝒊𝒏𝒈 𝒑𝒓𝒆𝒔𝒔𝒖𝒓𝒆 (𝒏𝒐 𝒔𝒊𝒈𝒏𝒊𝒇𝒊𝒄𝒂𝒏𝒕 𝒈𝒓𝒆𝒆𝒏 𝒄𝒂𝒏𝒅𝒍𝒆 𝒘𝒊𝒕𝒉 𝒗𝒐𝒍𝒖𝒎𝒆 𝒐𝒓 𝒏𝒐𝒕 𝒄𝒓𝒐𝒔𝒔𝒆𝒅 𝒕𝒉𝒆 𝒉𝒂𝒎𝒎𝒆𝒓’𝒔 𝑯𝒊𝒈𝒉), 𝒕𝒉𝒆 𝒑𝒂𝒕𝒕𝒆𝒓𝒏 𝒎𝒊𝒈𝒉𝒕 𝒇𝒂𝒊𝒍 𝒂𝒏𝒅 𝒘𝒊𝒍𝒍 𝒉𝒂𝒗𝒆 𝒕𝒐 𝒘𝒂𝒊𝒕 𝒇𝒐𝒓 𝒂𝒅𝒅𝒊𝒕𝒊𝒐𝒏𝒂𝒍 𝒄𝒐𝒏𝒇𝒊𝒓𝒎𝒂𝒕𝒊𝒐𝒏.
The additional confirmation includes looking for an accumulation phase or a strength in any indicator you use. We can also confirm the pattern as a pullback in an uptrend if the buyers are dominating- Analyse the structure with the Fibonacci Retracement tool, or use a Gann Fan tool.
Is an inverted hammer bullish or bearish?
The inverted hammer candlestick pattern indicates a bullish reversal or short-term downtrend reversal. After an extended sell-off, when prices are close to their lows for that period, an inverted hammer occurs. It resembles an upside-down, hanging shooting star candlestick formation, making it simple to identify on a chart. The body may be white or black, although it is frequently black to reflect the pressure of the cheap price to sell. An inverted hammer’s shadow can be either long or short; if it is longer than the hammer’s body, then there was more purchasing pressure than selling pressure at that low price.
What is a confirmation candle?
Confirmation candle is a candle that follows a bullish or a bearish candle and confirms the trend. Four data points are commonly used to establish the forms of candlestick patterns. These are the opening price, daily high, daily low, and closing price of the stock or asset. These four pieces of data indicate a certain price action pattern for a given day when combined. In reality, trading choices may be made by combining candlesticks across a number of days.
What does a bullish hammer candle indicate?
The shape of a hammer should resemble a “T.” This suggests the potential of a hammer candle. An upward price reversal is not indicated by a hammer candlestick until it is verified. If the candle that follows the hammer closes higher than the hammer’s closing price, confirmation has occurred. This confirmation candle should ideally indicate strong buying. The confirmation candle is the time when most candlestick traders try to enter long positions or exit short positions. A stop loss can be set for new long positions below the low of the hammer’s shadow.
What is the difference between gravestone and inverted hammer?
Imagine you are at the bottom of a downtrend and you notice a candlestick with a lengthy upper shadow. The Gravestone Doji and the Inverted Hammer are two symbols that you should be aware of in this situation. They anticipate opposing moves, which explains why. The Inverted Hammer predicts a trend reversal, while the Gravestone predicts the decline will continue. The lower shadow is considerably more obvious, while the latter has a visible body.
Can a red hammer be bullish?
Similar to a green hammer, a red hammer indicates the possibility of a positive trend reversal. It demonstrates that despite being able to dominate sellers, buyers were unable to raise the asset’s price over its opening price during the trading session.
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