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Chart Patterns

Hammer / Shooting Star

Single-candle reversal patterns: a hammer signals bullish reversal at lows, a shooting star signals bearish reversal at highs.

Hammer

A hammer has a small body at the top with a long lower wick (at least 2x the body). It appears at the bottom of a downtrend and signals that sellers pushed price down but buyers stepped in aggressively to close near the high.

Shooting Star

A shooting star is the inverse: small body at the bottom with a long upper wick. It appears at the top of an uptrend and signals that buyers pushed price up but sellers took control to close near the low.

Confirmation

Both patterns need confirmation from the next candle. A hammer followed by a green candle confirms bullish reversal. A shooting star followed by a red candle confirms bearish reversal.