Hence, a hammer candlestick printed on the chart is a strong hint of trend exhaustion and a possible reversal in the price direction. The structure of the candlestick indicates that the move towards lower prices is met with strong resistance and that buyers are coming into play and start gaining control of the situation. Hammer candlesticks are usually interpreted as bullish reversal signals. Below you can see the hammer candlestick variations. A hammer candlestick can be bullish or bearish and have no or a very small upper shadow. This means that the price moved strongly downwards during the candle period, but buyers stepped in and formed a resistance area, buying all excessive liquidity and causing the price to return close to the opening level. The hammer is a candlestick usually found at the bottom of bearish trends which looks likeвЂ¦a hammer! The hammer candlestick has a long lower shadow and a relatively small body. We will explain how you can identify them, what they mean and how they can be traded. More specifically, we will discuss the hammer pattern and the shooting star pattern. In this article, we expand on more candlestick patterns and we explain how you can interpret them and use them in your daily trading. Candlestick patterns are common candlestick formations that often contain useful information for trading decisions. The high and low points are connected with lines to the candleвЂ™s body, which is defined by the open and close prices and usually, candlesticks with a close price higher than the open price are colored in green, while candlesticks with a close price lower than the open price are colored in red. The displayed information is the open, high, low and close price for the timeframe represented by the candle. They display four pieces of information for a specific time period, in the form of a candle. Summarizing, candlestick patterns are specific candlestick formations, often used to facilitate trading decisions and assist in properly reading the market. Shooting Star Information at candlecharts.In our previous article we made an introduction to the candlestick patterns, as well as presented the candlestick pattern known as the Doji candlestick.Inverted hammer - Shooting star pattern found in a downtrend.After encountering this pattern traders often check for a lower open on the next period before considering the sell-signal valid.ДЄs with the Inverted hammer most traders will see a longer wick as a sign of a greater potential reversal and like to see an increase in volume on the day the Shooting Star forms. As this occurred in an uptrend the selling pressure is seen as a potential reversal sign. The long upper wick of the candlestick pattern indicates that the buyers drove prices up at some point during the period in which the candle was formed but encountered selling pressure which drove prices back down for the period to close near to where they opened. Like the Inverted hammer it is made up of a candle with a small lower body, little or no lower wick, and a long upper wick that is at least two times the size of the lower body. The Shooting Star looks exactly the same as the Inverted hammer, but instead of being found in a downtrend it is found in an uptrend and thus has different implications. In technical analysis, a shooting star is interpreted as a type of reversal pattern presaging a falling price. Shooting star patterns are found in uptrends

Shooting star chart pattern