Inverted hammer

The inverted hammer is a type of candlestick pattern found after a downtrend and is usually taken to be a trend-reversal signal. The inverted hammer looks like an upside down version of the hammer candlestick pattern, and when it appears in an uptrend is called a shooting star.

Pattern

The pattern is made up of a candle with a small lower body and a long upper wick which is at least two times as large as the short lower body. The body of the candle should be at the low end of the trading range and there should be little or no lower wick in the candle.

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 to close near to where they opened. When encountering an inverted hammer, traders often check for a higher open and close on the next period to validate it as a bullish signal.

gollark: If you got a WAV file from the original artist or something, maybe. If you got a WAV file from an MP3 file, no, it will not sound better than that MP3.
gollark: Yes, it is distorted and gets noise added when you run it through the annoying analog world too.
gollark: What I am saying is that converting from an existing (lossy) MP3 to a WAV does not magically add back information.
gollark: I am not saying that a WAV file is indistinguishable from a MP3 file *if they are both from a lossless source*.
gollark: ↑

See also
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