The short answer

A hammer is a single candle with a small body near the top of its range and a lower wick at least twice the body's height. It forms after a decline and shows that sellers pushed price down during the session and were fully repelled before the close.

Also called: bullish hammer, pin bar

A hammer forming after a decline, drawn from the pattern's real open, high, low and close proportions Hammer

Drawn to the real proportions the formation rules describe. Lead-in candles are dimmed; the pattern itself is bracketed.

  • Traditional bias Bullish
  • Type Reversal
  • Built from One candle
  • Context After a decline

How to spot it

  • The real body sits in the upper third of the candle's total range.
  • The lower wick is at least twice the height of the real body.
  • The upper wick is very small or absent.
  • It appears after a measurable decline, not in the middle of a range.
  • Body colour does not matter, though a close above the open is the stronger version.

What it actually means

The long lower wick is the whole message: sellers drove price well below the open and buyers took every bit of it back before the bell. That is a session where selling pressure was tested and failed. In a downtrend, a failed push lower is the first evidence that the supply driving the move has thinned out.

What confirms it

The next candle closes above the hammer's high, ideally on higher volume. Without that follow-through, a hammer is one session's story and nothing more.

What invalidates it

A close below the hammer's low. The low is the level the whole read rests on, so losing it says buyers did not in fact hold the line.

Where people get it wrong

Hammers are the most over-called pattern in trading, because the shape appears constantly. The shape only carries information after a real decline: the identical candle in the middle of a sideways range is noise, and in an uptrend it is a completely different pattern. Traders also routinely confuse it with the hanging man, which has exactly the same geometry and the opposite meaning; the only thing that separates them is what came before.

Common questions

Is the hammer bullish or bearish?
The traditional reading is bullish. The long lower wick is the whole message: sellers drove price well below the open and buyers took every bit of it back before the bell. It carries that reading only after a decline.
What confirms a hammer?
The next candle closes above the hammer's high, ideally on higher volume. Without that follow-through, a hammer is one session's story and nothing more.
When does the hammer stop working?
A close below the hammer's low. The low is the level the whole read rests on, so losing it says buyers did not in fact hold the line. Beyond that, hammers are the most over-called pattern in trading, because the shape appears constantly.

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Formation rules follow Japanese Candlestick Charting Techniques by Steve Nison. Reviewed 2026-09-14.