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Candlestick pattern: Confirmed Hammer
Updated
A Hammer candlestick is a single-candle reversal pattern that indicates a potential change in the trend direction.
These candles are typically characterized by a high or low that is significantly distant from the closing price, with the shadow being at least twice the size of the body.
Like any candlestick pattern or analysis tool, its reliability increases with the presence of more confluences or signals. Therefore, in this case, we choose to trade this pattern when the confirmation criteria are met. However, in practice, there may be other factors to consider that could influence the decision to enter or not enter a trade.
Additionally, there is another type of confirmation for this pattern. The most secure confirmation (but with less projection) would be to wait for the candle following the Hammer to close above it (in the case of a reversal to the upside). This would indicate that the rejection of continuing the current trend is genuine and that a change in direction is more likely.
These candles are typically characterized by a high or low that is significantly distant from the closing price, with the shadow being at least twice the size of the body.
Like any candlestick pattern or analysis tool, its reliability increases with the presence of more confluences or signals. Therefore, in this case, we choose to trade this pattern when the confirmation criteria are met. However, in practice, there may be other factors to consider that could influence the decision to enter or not enter a trade.
Additionally, there is another type of confirmation for this pattern. The most secure confirmation (but with less projection) would be to wait for the candle following the Hammer to close above it (in the case of a reversal to the upside). This would indicate that the rejection of continuing the current trend is genuine and that a change in direction is more likely.
Trade closed manually
Trade closed manually
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