Reversal Candlestick Patterns and Their Confirmation: Hammer and Hanging Man Candlestick Pattern - Bullish and Bearish Candlesticks

Hammer Bullish Candlestick Patterns - Hanging Man Bearish Candle Patterns

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

These reversal candlestick patterns are:

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

Hammer Candle Pattern and Hanging Man Candle Pattern Candles

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

Hammer Candle Pattern and Hanging Man Candle Pattern Candles

Hammer Candlestick

Hammer is a potentially bullish pattern which occurs during a forex downtrend. It is named so because the market is hammering out a market bottoms.

A hammer has:

• A small body
• The body is at the top
• The lower shadow is 2 or 3 times the 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 Candle

Technical Analysis of Hammer Candles Pattern

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

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

Hanging Man Candlestick

This pattern is a potentially bearish reversal signal which occurs during a forex uptrend. It is named so because it resembles a man hanging on a noose up high.

A hanging man candle has:

• A small body
• The body is at the top
• The lower shadow is 2 or 3 times the length of the real body.
• Has no upper shadow or very small upper shadow if present.
• The color of the body is not important

Hanging Man Candle

Technical Analysis of Hanging Man Candles Pattern

Sell trading signal is confirmed when a bearish candlestick closes below the open of the candle on left-side of this hanging man candle pattern.

Stop orders should be set a few pips just above the high of the hanging man candle.