Inverted Hammer and Shooting Star Candlestick
What is Inverted Hammer Candlestick?
Inverted Hammer is a single candlestick that looks like a turnabout hammer, usually found in a downtrend consisting of a long wick/shadow on its upper body. The Colour of the candle doesn’t matter, it can be bullish or bearish. This candle itself represents rejection from the lower price (or any important key level).
Inverted Hammer and Shooting look the same the only difference is formed in a trend.
How to Identity Inverted Hammer Candlestick?
- Open and close of the candlestick is not so far.
- The length of the candle should be twice or thrice of the body or more.
- The candle should appear after a good downtrend, not a short term downtrend.
How to trade Inverted Hammer candlestick:
Buy after the candle fully closed and stop loss below the low of the candle and take profit is up to next resistance.
Live Example
Very well and precise entry, the market is about to take out us of the trade, but managed to in and end up with the profit.
What is Shooting Star Candlestick?
It’s the same candlestick as Inverted Hammer the only difference between these candles is it found in an uptrend, having a long wick above its body. Again, here color doesn’t matter and works the same. The candle itself represents that bulls pushed the market aggressively and bears have taken over the market and closed price near its opening price.
How to Identity Shooting Star Candlestick?
- Open and close of the candlestick is not so far.
- The length of the candle should be twice or thrice of the body or more.
- The candle should appear after a good uptrend, not a short term uptrend.
How to Trade Shooting Star candlestick:
Sell after the closing of the candle and stop-loss above the high of the candle and take profits is up to you but we consider it till previous support.
Live Example
Here a quick fall and heavy profits after shooting star appeared.
Note: Always Trade candlesticks patterns wisely with proper risk management else your trading funds will always at high risk.
