SINGLE CANDLESTICK BULLISH REVERSAL PATTERNS: INVERTED HAMMER

Bullish Single Candlestick Reversal Patterns – Inverted Hammer

Nature – Like Hammer, it’s also a Bullish Single Candle Reversal Pattern which is relevant when forms at the bottom of downtrend or at the bottom of a pullback and can indicate short to long term trend reversal after confirmation.

Real Body – Can be either green or red.But green Inverted Hammer is slightly more bullish than red one.

Upper Shadow -The upper shadow should be at least 2 times the size of the body.

Lower Shadow – Ideally no lower shadow, but very small upper shadow is acceptable.

Set up -It is form at the bottom of downtrend.

There must be downtrend.

Ideally it gaps down form the previous candle.

Confirmation of Set up – Price trading above inverted hammer for aggressive traders.

Price closes above the high of inverted hammer for conservative traders.

Inverted-Hammer-Sample-1

 

 

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