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The Inverted Hammer Pattern

The Inverted Hammer formation is a one-candle pattern. If you are familiar with the Hammer pattern this name makes sense to you as this pattern looks like an inverted pattern. In other words Inverted Hammer is a single candle pattern at the bottom of a downtrend. It has a small real body and a zero-size or a very small lower shadow (see image).

This pattern rarely appears in a forex chart. It is also not a very reliable pattern. I strongly suggest to use other tools to confirm this pattern if you intend to trade it. This patter is especially more reliable if the next session candle opens above the real body of the Inverted Hammer (see image above).

Locating "Inverted Hammer" Formation in a Chart

I have developed a custom indicator for MetaTrader 4 that locates Inverted Hammer in a chart (see image).

Download the "InvertedHammer" Indicator [download]

Click here to download the compiled version of this indicator. I have designed the indicator for MetaTrader 4 (MT4). If you are not using the latest build of MT4 then you may encounter technical problems. Click here for more information and possible solutions.

If you are not familiar with using custom indicators then click here.

If you are one of my MQL students you may download the source code of this indicator from your training site. Click here for more information about my MQL training program. You may also click here for more information about different options that I offer for training MQL (one of them is absolutely free).

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Previous Candlestick Lessons:

Lesson 01: An Introduction to Candlestick Charts

Lesson 02: Umbrella Lines - Reversal

Lesson 03: Doji Candles - Part 1

Lesson 04: Doji Candles - Part 2

Lesson 05: The Spinning Top Candle

Lesson 06: The Engulfing Pattern

Lesson 07: Dark-cloud Cover

Lesson 08: Bullish Piercing Formation

Lesson 09: Window - Falling and Rising

Lesson 10: Morning Star a Bullish Reversal Pattern

Lesson 11: Evening Star a Bearish Reversal Pattern

Lesson 12: Shooting Star a Bearish Reversal Pattern

Lesson 13: Doji Star a Reversal Pattern