Inverted Hammer Candlestick Pattern: What 5,130 Cases Show
The inverted hammer is a hammer flipped upside down: a small body at the bottom of the candle and a long wick pointing up. It looks exactly like a shooting star, but it shows up after a decline instead of a rally, and it’s read as bullish. The logic is a little more of a stretch than the hammer’s. Buyers pushed the price well up during the day, sellers knocked it back down by the close, but the fact that buyers showed up at all after a selloff is taken as an early sign of a turn. Our scanner has logged 5,130 inverted hammers across 559 US stocks and ETFs over three years. ...