Hammer
A small body near the top of the bar with a long lower wick, after a fall.
What it shows
A hammer has a small body in the upper third of the bar and a lower wick at least twice the body. It appears after a decline. During the bar, price fell sharply and then recovered most of the way.
It is a one-bar shape. Its name comes from Japanese candlestick charting.
How we find it
The same code that draws it on your chart follows these steps, with the same result every time.
- Check price fell over the last 5 bars.
- Body in the upper third of the range.
- Lower wick ≥ 2× body.
- Upper wick very small.
Starting values: Lower wick ≥ 2× body; Prior fall 5 bars. These are proposed and will be tuned on real price data before launch.
How to read it
- The gold candle is the hammer.
- Its long lower wick shows price dropped and returned.
- Candles before it fall.
Status labels you may see
| Label | What it means |
|---|---|
| Hammer today | Rule met on the last bar. |
| Recently | Within the last 5 bars. |
| None | No hammer found. |
What cancels it
Nothing cancels it.
What traders check next
- The size of the lower wick.
- The next bar's close.
- Volume on the hammer.
Limits
- Appears often.
- Outcomes vary.
- Needs a prior decline to be called a hammer.
Try it in forecastviz
- Open any ticker and choose Candlestick patterns → Hammer in the left menu.
- Switch between 3M, 6M to see how the picture changes.
- Compare with Hanging man and Inverted hammer on the same chart.
Questions
What's the difference from the hanging man?
Same shape, after a rise.
Does it predict a rise?
No claim.
Related trends
Further reading
- Nison, Japanese Candlestick Charting Techniques
- Bulkowski, Encyclopedia of Candlestick Charts
- Morris, Candlestick Charting Explained
Educational only. Not financial advice, and not a price forecast. Charts are drawn by code from past price data, which may be delayed.