Buyers slammed the floor and dragged price back up — a sign the downtrend may be exhausted.
Hover or tap a numbered label to learn what each part means.
By itself the hammer is just a candle. Its real power comes from where it appears: at a level of support (see Reading Charts: Support and Resistance), after a clear downtrend (see Reading Charts: Trends), with above-average volume. Without those, the same shape is just noise.
Five red candles bring price down to a previous support level. The sixth candle drops further, then buyers slam it back up. This is the textbook hammer — high probability reversal.
This is the highest-probability hammer setup. Three things confirm it: (1) clear downtrend leading in, (2) hammer prints at a known support level, (3) the next candle closes above the hammer's body. Without all three, the hammer is just a candle — with them, it's a signal worth acting on.
Hammer: Buyers slammed the floor and dragged price back up — a sign the downtrend may be exhausted.
Hanging Man: Looks like a hammer, but at the top — sellers showed up at the highs and the trend may be over.
Hammer: Buyers slammed the floor and dragged price back up — a sign the downtrend may be exhausted.
Inverted Hammer: Looks like a shooting star, but at the bottom — buyers showed up at the lows and the trend may be ending.
Hammer: Buyers slammed the floor and dragged price back up — a sign the downtrend may be exhausted.
Doji: Buyers and sellers fought to a draw — the trend may be losing steam.
Buyers and sellers fought to a draw — the trend may be losing steam.
Hover or tap a numbered label to learn what each part means.
A doji is the market saying 'I'm uncertain.' On its own it means very little. Its power comes from where it appears: at the end of a strong trend, a doji is the first sign that conviction is fading. In the middle of a range, it's noise.
Five strong green candles drive price higher. Then a doji prints — buyers tried, sellers tried, neither won. The trend's conviction just cracked.
After a strong move, a doji is the market's first hesitation. It doesn't guarantee a reversal — but it does tell you the buyers running this trend just lost momentum. Smart traders tighten stops or take partial profits when they see a doji at the end of a run.
Doji: Buyers and sellers fought to a draw — the trend may be losing steam.
Hammer: Buyers slammed the floor and dragged price back up — a sign the downtrend may be exhausted.
Doji: Buyers and sellers fought to a draw — the trend may be losing steam.
Shooting Star: Buyers reached for new highs and got smacked back down — the uptrend may be exhausted.
Buyers reached for new highs and got smacked back down — the uptrend may be exhausted.
Hover or tap a numbered label to learn what each part means.
By itself a shooting star is just a candle. Its real power comes from where it appears: at a level of resistance (see Reading Charts: Support and Resistance), after a clear uptrend (see Reading Charts: Trends), with above-average volume. Without those, the same shape is just noise.
Five green candles drive price up to a previous resistance level. The sixth candle reaches even higher, then sellers crush it back to the open. Textbook bearish reversal.
This is the highest-probability shooting star setup. Three things confirm it: (1) clear uptrend leading in, (2) shooting star prints at a known resistance level, (3) the next candle closes below the shooting star's body. Without all three, it's just a candle with a long wick — with them, it's a setup worth shorting (or exiting longs on).
Shooting Star: Buyers reached for new highs and got smacked back down — the uptrend may be exhausted.
Inverted Hammer: Looks like a shooting star, but at the bottom — buyers showed up at the lows and the trend may be ending.
Shooting Star: Buyers reached for new highs and got smacked back down — the uptrend may be exhausted.
Hanging Man: Looks like a hammer, but at the top — sellers showed up at the highs and the trend may be over.
Shooting Star: Buyers reached for new highs and got smacked back down — the uptrend may be exhausted.
Doji: Buyers and sellers fought to a draw — the trend may be losing steam.
Looks like a hammer, but at the top — sellers showed up at the highs and the trend may be over.
Hover or tap a numbered label to learn what each part means.
The hanging man is the lesson 'context is everything' in pure form. The shape is identical to the hammer's. The wicks tell the same physical story: sellers attacked, buyers held. The difference is what comes next. After a downtrend, that buyer defense is encouraging. After an uptrend, it's a warning sign — the first time sellers have been able to drag price meaningfully lower at all.
Five strong green candles drive price to a new high. The sixth opens, drops sharply intraperiod, then climbs back to close near the open. Same shape as a hammer — completely opposite meaning.
Look at this candle. Now look at the hammer in the hammer lesson. They are EXACTLY the same shape — small body near the top, long lower wick, no upper wick. The difference is everything around it. Here, the long lower wick is bad news: it means sellers were able to drag price all the way down from the high before buyers fought back. In a strong uptrend, that's the first crack in the buyers' wall.
Hanging Man: Looks like a hammer, but at the top — sellers showed up at the highs and the trend may be over.
Hammer: Buyers slammed the floor and dragged price back up — a sign the downtrend may be exhausted.
Hanging Man: Looks like a hammer, but at the top — sellers showed up at the highs and the trend may be over.
Shooting Star: Buyers reached for new highs and got smacked back down — the uptrend may be exhausted.
Hanging Man: Looks like a hammer, but at the top — sellers showed up at the highs and the trend may be over.
Doji: Buyers and sellers fought to a draw — the trend may be losing steam.
Looks like a shooting star, but at the bottom — buyers showed up at the lows and the trend may be ending.
Hover or tap a numbered label to learn what each part means.
The inverted hammer is the mirror of the hanging man — same context-flips-meaning lesson, opposite direction. After a long downtrend, the long upper wick is encouraging because it's the first period where buyers were able to push price meaningfully higher at all. Even though sellers came back and dragged price down before the close, the fact that buyers got a foothold matters.
Five red candles drag price to a new low. The sixth opens, spikes way up intraperiod, then falls back to close near the open. Same shape as a shooting star — completely opposite meaning.
Look at this candle and compare it to the shooting star in the shooting star lesson. They are EXACTLY the same shape — small body near the bottom, long upper wick, no lower wick. The difference is everything around it. Here, the long upper wick is good news: it means buyers were able to push price all the way up from the low before sellers fought back. In a long downtrend, that's the first crack in the sellers' wall.
Inverted Hammer: Looks like a shooting star, but at the bottom — buyers showed up at the lows and the trend may be ending.
Shooting Star: Buyers reached for new highs and got smacked back down — the uptrend may be exhausted.
Inverted Hammer: Looks like a shooting star, but at the bottom — buyers showed up at the lows and the trend may be ending.
Hammer: Buyers slammed the floor and dragged price back up — a sign the downtrend may be exhausted.
Inverted Hammer: Looks like a shooting star, but at the bottom — buyers showed up at the lows and the trend may be ending.
Doji: Buyers and sellers fought to a draw — the trend may be losing steam.
One side dominated the entire period — strong continuation signal.
Hover or tap a numbered label to learn what each part means.
A marubozu is conviction in candle form. When the body fills the entire range with no wicks, it means the winning side never let the losing side touch price. Bullish marubozus often appear when buyers push price through a price level it had been bouncing off of, signaling commitment. Bearish ones do the same in reverse. Marubozus are NOT reversal signals — they're continuation signals. They tell you the existing direction is strong, not that it's about to flip.
Price has been bouncing under a level for 4 candles, unable to break above it. Then a green marubozu fires straight through — long body, no wicks. Buyers committed and the level couldn't hold them back.
A marubozu pushing through a key level is one of the most reliable continuation signals in candlestick analysis. Compare it to a candle with long wicks pushing through the same level: the wicked candle shows the level was contested. A marubozu shows the level was demolished. Buyers had so much conviction they didn't even let sellers touch the candle's open price. Stops can go below the marubozu's low (which is essentially its open).
Marubozu: One side dominated the entire period — strong continuation signal.
Bullish Engulfing: Buyers came in so hard they reversed an entire bearish candle in one move.
Marubozu: One side dominated the entire period — strong continuation signal.
Bearish Engulfing: Sellers came in so hard they reversed an entire bullish candle in one move.