Reversal Candlestick Patterns - Inverted Hammer Bullish Stock Candle Patterns

Reversal Candle Chart Patterns: Bullish Stock Candle Patterns & Bearish Stock Candle Patterns

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

The reversal candle-stick patterns are:

1. Hammer Stock Candlesticks Pattern & Hanging Man Stock Candle Pattern
2. Inverted Hammer Stock Candlesticks Pattern and Shooting Star Stock Candle Pattern
3. Piercing Line Candlestick Pattern and Dark Cloud Cover Stock Candle Pattern
4. Morning Star Candle Sticks & Evening Star Candles
5. Engulfing Stock Candles Patterns

Hammer Stock Candlesticks Pattern & Hanging Man Stock Candle Pattern

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

Hammer Stock Candlesticks Pattern & Hanging Man Stock Candle Pattern

Hammer Stock Candle Sticks Patterns

Hammer is a potentially bullish pattern which occurs during a downwards trend. It is named so because the stock market is hammering out a market bottoms.

A hammer has:

• A small body
• The body is at the top
• The lower shadow is two or three times 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 Candlesticks

Technical Analysis of Hammer Candle Sticks Patterns

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

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

Reversal Candle Patterns: Bullish Candle Patterns & Bearish Candlestick Patterns

Inverted Hammer Stock Candles Pattern & Shooting Star Candle Pattern candles look alike. These have a long upper shadow and a short body at the bottom. Their fill color does not matter. What matters is the point where these candle-sticks 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-stick pattern.

Upward Trend Reversal - Shooting Star Candles

Downward Trend Reversal - Inverted Hammer Candles

Inverted Hammer Stock Candles Pattern & Shooting Star Candle Pattern Chart Setups

Inverted Hammer Candle

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

Inverted hammer occurs at the bottom of a down trend and indicates the possibility of market reversal of the downwards stock trend.

Inverted Hammer Candlestick

Technical Analysis of Inverted Hammer Candle

A buy is completed when a candlestick closes above neck-line, this is opening of the candlestick on leftside of this pattern. The neck-line in this instance is a resistance area.

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

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