Candlestick Patterns · Bullish
Inverted Hammer
A small body near the low and a long upper shadow, after a decline.
Buyers tested higher during the candle, but the close stayed near the open. It is only a possible bullish clue after a decline, and it needs the next candle to confirm.
This is an example of how traders often plan the pattern. It is not a promise that price will reach the target.
Identification
- The upper shadow is long relative to the body.
- The body is small and near the low.
- It appears after a decline.
Market context
The same shape after a rally is a shooting star.
Entry example
An example entry is a later close above the inverted hammer high.
Stop-loss example
An example stop is below the inverted hammer low.
Target example
An example target is the last lower high of the decline.
Common mistakes
- Buying it only because the upper wick looks tall.
Candlestick and chart patterns are probabilistic observations, not guaranteed trading signals. This page does not report a win rate.