Hammer Pattern
A single-candle bullish reversal pattern that forms at the bottom of a downtrend. It has a small body near the top of the range and a long lower shadow (at least twice the body size), indicating that sellers pushed prices down during the session but buyers regained control and pushed the price back up near the open.
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What's in the Hammer lesson
- ▸Annotated chart with the Hammer highlighted across the context candles.
- ▸Numbered identification rules covering body, shadows, color and position in trend.
- ▸The psychology of the formation: why buyers or sellers create this exact shape.
- ▸Practical tip on what to wait for before treating the pattern as a tradeable signal.
- ▸Quiz questions with explained answers, including this exact pattern.
Quick answers
Is the Hammer pattern reliable?
The Hammer has a 60% reliability rate per Bulkowski's encyclopedia, a statistical baseline. Confirmation candles and volume strengthen the read. The Candle Trader app has the full formation rules and a quiz.
What timeframes does the Hammer work on?
Candlestick patterns work on any timeframe, from scalping (M1-M5) through day trading (M15-H1) to swing trading (H4-W1) and long-term investing. The shorter the timeframe, the more false signals. Always check higher timeframes for context.