Inverted Hammer Candlestick Pattern _ पूरी जानकारी.

 Inverted Hammer Candlestick Pattern _ पूरी जानकारी.

How to Trade the Inverted Hammer Candlestick Pattern.

You can get all the information you require regarding the Inverted Hammer candlestick pattern here.

·      The Inverted Hammer Candlestick Pattern: Explained.

·      How to Recognize the Inverted Hammer Candlestick Pattern.

·      The Inverted Hammer Candlestick Pattern's variations.

·      Trading the Inverted Hammer Candlestick Pattern: A Guide.

·      Trading Techniques for the Inverted Hammer Candlestick Pattern.

 

Ø Strategy 1: Retractions on Bare Charts.

Ø Strategy 2: Using Support Levels to Trade the Inverted Hammer.

Ø Strategy 3: Using Moving Averages to Trade the Inverted Hammer.

Ø Strategy 4: Using RSI Divergences to Trade the Inverted Hammer.

Ø Strategy 5: Using Fibonacci to Trade the Inverted Hammer.

Ø Strategy 6: Using Pivot Points to Trade the Inverted Hammer.

The Inverted Hammer Candlestick Pattern: Explained. 

Japanese candlesticks use the Inverted Hammer pattern.

This reversal pattern is bullish.

It usually appears after a fall in price and indicates that lower costs are rejected.

This pattern is bullish because we expect a bull move following the breakout of an Inverted Hammer at right moment.

It's a reversal pattern since we want to see price growth prior to the Inverted Hammer showing up, which is also a common indication that a trend is coming to an end.

The Hammer Candlestick design is mirrored in the Inverted Hammer concept.

 How to Recognize the Inverted Hammer Candlestick Pattern.

A single candle creates the Inverted Hammer candlestick pattern. 

To recognize the Inverted Hammer candlestick pattern, follow these steps:

1.    The candle's body is small.

2.    The top wick needs to be larger than the body.

3.    It should be very small or have no wick at the bottom.

4.    The body's color has no impact.

Look at……......................................................................................

The Inverted Hammer Candlestick Pattern's variations.

On your charts, the Inverted Hammer candlestick pattern can look a little different.

It makes no difference what color the body is; it can be either green or red (bullish or bearish).

It also doesn't matter if there is a wick (shade) at the bottom. You're fine as long as it's small.

 Look at….............................................................................

Trading the Inverted Hammer Candlestick Pattern: A Guide.

Finding a candle on your charts with the same form is not enough to trade the Inverted Hammer candlestick pattern.

The Shooting Star is one of the candlestick designs that actually has the exact same shape.

Confused?

Let me clarify.

A pattern is valid not only because of its shape but also because of where it appears.

This implies that the same form could represent multiple things depending on where it appears.

The price should first decline, indicating a bearish move, before we trade the Inverted Hammer.

Following this negative move, an Inverted Hammer indicates a potential upside reversal.

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It's easy: when the candle's high is broken, the Inverted Hammer pattern is traded.

That is your cautious long-term trigger.

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Because trading doesn't always go as planned, you also want to protect yourself.

And we apply a stop loss for that.

There are many different kinds of stop losses.

The most popular method is to set it using the other side of the pattern.

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Do not, however, trade the Inverted Hammer just yet.

We need to know a few more things.

The Inverted Hammer candlestick pattern should ideally be traded in conjunction with other technical analysis or indicators to improve accuracy.

The following are some trading tactics for the Inverted Hammer pattern.

Trading Techniques for the Inverted Hammer Candlestick Pattern.

 Strategy 1: Retractions on Bare Charts.

The Inverted Hammer is a bullish reversal pattern that is worth keeping watch on when the price is increasing.

Simply wait for a pullback to begin, and then look for the Inverted Hammer.

That usually signals the start of the fresh leg to the upside and the conclusion of the pullback.

For Example……......................................................................

Strategy 2: Using Support Levels to Trade the Inverted Hammer.

A good area to look for price reversals is at the levels of support and resistance.

We want to trade the Inverted Hammer using support levels since we are searching for upward movements. 

How it operates:

·      On your charts, draw the support levels.

·      Hold off until the price drops and reaches the support level.

·      Verify if an Inverted Hammer shows up there.

·      When the price breaks the Inverted Hammer's peak, go long.

·      Determine your take-profit and stop-loss levels and anticipate an upward move on.

 For Example………………….....................................................

Strategy 3: Using Moving Averages to Trade the Inverted Hammer.

When it comes to trading patterns, moving averages are excellent indicators.

When the price is rising, the goal is to trade pullbacks to the moving average.

How it operates:

·      Identify an upward trend when the price surpasses a moving average.

·      Await the price to drop to the moving average.

·      Verify whether the moving average displays an Inverted Hammer.

·      When the price breaks the Inverted Hammer's peak, go long.

·      As you set your take-profit and stop-loss settings, anticipate another upswing. 

For Example………….............................................................

Strategy 4: Using RSI Divergences to Trade the Inverted Hammer.

This differs slightly from the other trading methods.

The price must first be on a downward trend, producing lower lows and lower highs, in order to identify a bullish RSI divergence.

It operates as follows:

·      Look for a downward trend.

·      After each leg to the downside, note the price's lows.

·      Comparing the price lows with the RSI indicator at the same time

·      You can identify divergence when the price makes lower lows and the RSI makes higher lows.

·      You now watch for an Inverted Hammer to show up at a lower low in price that coincides with a higher low on the RSI.

·      Invest in long positions when the price breaks the Inverted Hammer's peak.

·      Assume an upward rise and set your take-profit and stop-loss levels.

For Example……………….............................................................

Strategy 5: Using Fibonacci to Trade the Inverted Hammer.

The Fibonacci retracement tool is another well-liked method of trading the Inverted Hammer candlestick.

When the price tends to reverse, Fibonacci displays retracement levels.

Different levels are more likely to function better with the Inverted Hammer pattern, depending on how strong the trend is. More information about the various Fibonacci retracement levels may be found here.

The strategy operates as follows:

·      You want to see an upward trend in the pricing.

·      You then wait for a decrease, which always occurs eventually.

·      Draw the levels of the move from its low to its high using your Fibonacci tool.

·      Your waiting period will come when the price reaches a Fibonacci level and prints an Inverted Hammer.

·      When the price breaks the Inverted Hammer's peak, go long.

·      Establish your take-profit and stop-loss levels and anticipate an upward advance.

For Example…………………….........................................................

Strategy 6: Using Pivot Points to Trade the Inverted Hammer.

Pivot points are automatically determined levels of resistance and support based on mathematical calculations.

The Daily Pivot Points are the most widely employed while day trading, though the Weekly and Monthly are also commonly utilized. 

Here's how to use pivot points to trade the Inverted Hammer pattern:

·      Turn on your charts' Pivot Points indicator.

·      Look for pivot points that is below the price; they will typically serve as a support.

·      Although it's not necessary, it's ideal to see the price rising.

·      Await the price to drop to a Pivot Point level.

·      You want to see an Inverted Hammer pattern at that level, which indicates that the level is being refused.

·      When the price breaks the Inverted Hammer's peak, go long.

·      Assume an upward rise and set your take-profit and stop-loss levels.

For Example……………….......................................................

What Is The Inverted Hammer's Success Rate?

The Inverted Hammer candlestick pattern has a 70% success rate, per Thomas N. Bulkowski's Encyclopedia of Candlestick Charts.