Hammer
A single candle with a small body near the top and a long lower wick — buyers rejected a sharp intra-session sell-off — a bullish reversal signal.
The Hammer forms at the bottom of a downtrend. It has a small real body (bullish or bearish) near the session high, with a lower wick at least twice the body length and little to no upper wick. The shape looks like a hammer handle pointing down.
During the session, sellers drove price sharply lower, but buyers absorbed every bit of that selling pressure and pushed price back near the open. That recovery signals potential demand at this level.
A bullish Hammer with a closing green body is stronger. Confirmation on the next candle (close above the Hammer's body) increases reliability significantly.
Example
After a 15% correction, a Hammer forms right on a key Fibonacci retracement level with above-average volume. The next day closes bullish and above the Hammer's body — traders enter long with a stop below the Hammer's low.
Related Terms
Belt Hold
A single long candle with no wick on the opening side — either a bullish open at the low or a bearish open at the high — an early-session dominance signal.
BeginnerBullish Engulfing
A large bullish candle that completely wraps the prior bearish candle's body — a strong demand-takes-control reversal signal at the bottom of a downtrend.
BeginnerDragonfly Doji
A Doji with a long lower wick and no upper wick — open, high, and close near the same level — a bullish rejection signal.
BeginnerHanging Man
A Hammer-shaped candle appearing at the top of an uptrend — the long lower wick hints that selling pressure is creeping in — a bearish warning.
BeginnerInverted Hammer
A small body near the bottom with a long upper wick — buyers attempted to push higher during the session — a tentative bullish reversal signal after a downtrend.
BeginnerMorning Star
A three-candle bullish reversal: a long bearish candle, a small indecision candle gapping lower, then a large bullish candle recovering above the midpoint.
BeginnerPiercing Line
Two-candle bullish reversal: a bearish candle followed by a bullish candle that opens below the prior low and closes above the midpoint of the first body.
BeginnerPin Bar
A candle with a small body and a long wick on one side — a sharp price-rejection signal widely used in price-action trading.
BeginnerTweezer Bottom
Two consecutive candles with matching lows at the bottom of a downtrend — the shared low was rejected twice, hinting at a floor.
BeginnerWick
The thin lines above and below a candle's real body, marking the session's high and low extremes beyond the open/close range.
Beginner