Hammer

The Hammer is a bullish reversal candlestick pattern that forms after a downtrend.

It has a small real body at the upper end of the trading range with a long lower wick, typically 2-3 times the length of the body.

This pattern indicates that sellers pushed prices lower during the session, but buyers stepped in aggressively to push prices back up, signaling a potential trend reversal.

Professional traders look for confirmation with a bullish candle on the following day and increased volume.