Hammer and Hanging Man Chart Patterns

The Hammer and Hanging Man patterns go hand in hand and represent a bullish and bearish signal.
In this video trading expert David Jones breaks them down and shows us how to spot them on the chart, how to interpret their appearance and what to watch out for before making a trading decision.
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The information contained within the video was correct at the time of recording but may have since changed.
At Trading 212 we provide an execution only service. This video should not be construed as investment advice. Investments can fall and rise. Capital at risk. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

[@celzolsen8988]

This makes so much sense. I've tried using the hanging man especially (over the hammer) and it has not been very accurate at all. Thanks for verifying my thoughts on the hanging scam. :-)

[@AliveforAPurpose]

Always look forward to your videos, helpful as always. Thank you so much.

[@Geeza-rc9kz]

Thanks for another great video. I'll go and check out the engulfing patterns now 👍

[@charlesholloway6102]

Very appreciative of the information you present. I am always watching your videos and taking notes

[@DubstepDinosaurs]

Appreciate your videos. I like the 3 monitor setup and the office vibe there.

[@yusuframdane2221]

Thank You very much for all the GREAT Effort you are making, hope you GREAT Sucess

[@kaustshroff381]

You are without a doubt one of the best KZbinrs regarding Forex trading. I truly appreciate your videos, as I am so new to this profession.

[@stevejones4010]

Thank you for the update.

[@sagarbhamare6997]

thanks, David & 212 for amazing video tips for trading

[@gambohassan8581]

Thank you for the video you the best

[@Prabhu_Anandan]

your videos(teaching) was really helpfull thankyou sir

[@Michael-it6cu]

Thank you very much. It was amazing.

[@marmap9939]

IMO an inverted hammer at resistance makes much more sense than a hanging man.

[@davidjones2452]

I would definitely agree with you on that.

[@cosmopolitanmind5583]

If I'm not wrong, an Inverted hammer at the top of a uptrend or at resistance level called a shooting star.

[@yasiradeelnaqvi7734]

Thanks Very Helpful

[@bladeee007]

Nice video. Thank you

[@christhechief]

Thank you this was 🔥🔥🔥🔥

[@BaharSangkur]

Thank you from Bali

[@joycekanyangii7679]

Thank you so much.

[@muhammadrezagholami3650]

i loved it pretty much and i've found it really simple to understand. on minute 7 in the video 0.5 fab there is a red candle which is kinda like the hammer, is that it?

[@TGBMedly]

David, I am really learning a lot from you. Can you tell me more on what to know for trade swinging and how to read candlesticks. I am watching all your videos but noticed these were filmed awhile back. Thanks David. From Ohio the usa

[@birendradhojshrestha9237]

Thanks David

[@homefood1868]

Hi Thanks for the info, do we need to consider this patterns of candles for day to day or with in day for each minute. Thanks in advance.

[@princessgirl50]

Thanks for telling us at the end about making sure the bell is clicked to get notifications. I didnt know that. :-)

[@omwithme6277]

GREAT.....

[@AirElegant]

This is my favourite hammer.

[@ahmedorabi5497]

Thank you

[@satyansharma1166]

Please let me know which time interval(1minute, 5 minute, 10 minutes, 30 minutes, 1 hour) is good for trading. And for the trading purposes Is it right for the daily and weekly charts to asses the trend of the market?

[@JOKBO1]

Hello Mr.Jones. You once said that sometimes it's better to simply look at the price action and don't get into a indicators overload. Having said that, which indicators and patterns are your favorite when trading? Which ones do you find being the most helpful in your trades? Thank you.

[@davidjones2452]

Hi, you are right that for me it is mainly about the price. But I will look at candlestick patterns like engulfing and RSI divergence now and again.

[@JOKBO1]

Thanks for the reply. I actually ended up looking at those as well plus the MACD. Engulfing candlesticks are a really good pattern when I'm trading in the short(ish) term

[@ronaldbills5276]

Mr Jones, I am in Guam, have been trading but not real successful, you fill in all the gaps of questions that have gone unanswered. I do have a question. What are some of the lengths of your trade, do some of them go for the week, over the weekend and also possible much longer, from your explanations it would appear that some trades go for an extended time frame. Also when you take your trade, do you base the trade of the 15 min, 30 min, hour, daily, weekly etc. I really enjoy all of this and want to be a very successful trader. You do a great classy job. Also do you recommend any particular brokers to use? Thanks

[@davidjones2452]

Hi Ronald thanks for the question. I tend to look at hourly and daily and not really much shorter. I have trades that run for weeks and some for a few days. The most important thing for me is where does the stop loss go - which is why I look at the higher time frame stuff, I do not want to get taken out in the noise of a 5 minute chart. As the part of the world you are in is a USA territory, I am not sure what broker to use as the rules are very different unfortunately - you can't use Trading 212 for example. Sorry I can't help with that one.

[@variable7911]

thank you

[@haydenh2283]

For any strategy to be able to have a deliberate positive effect, the under line pressures must come together in a reliable way and that is impossible cos the billions of combinations of accumulations of independent underline reasons say so.

[@guilhermegilmoura8623]

very nice

[@fabriziogambardella1350]

The hammer like the engulfing candlestick strategies are useful for intraday trading or only for multiday trading? Thanks

[@deemajor7506]

So when you’re reading candle stick charts the main patterns or only patterns you look for are the hammer and bearish and bullish engulfing patterns?

[@vijayalakshmimm2013]

Good one

[@TucaLoni]

what about when they are inverted?

[@TenTonNuke]

Instead of learning all the names of indicators, I've always just imagined the chart turned 90 degrees and seen the color bar as the bubble in a level or a weight on a rod. When the weight slides all the way to the end of the rod, it moves the whole thing toward the "left" or "right." That's hard to explain and easier to just visualize.

[@SoldierTrading]

nice, I visualise the chart flipped upside down, same story on both ends

[@mininigenovesi7333]

Guys I'd love if you make a video on gdx (on which i am invested), the most undervalued sector worldwide. And mostly on the last week's movement, that myself being an ignorant person, i thought it as a sort of washout, or not? Thanks

[@abdellahlaglasse7574]

do we need to wait for confirmation, for exemple , after a hammer ?

[@andreicatalin7665]

Hello. Please make a video about parabolic SAR

[@omwithme6277]

andrei catalin please, I love that indicator!

[@abiebi11]

Does the hammerhead candlestick reversal also mean a reversal if the share is trading sideways?

[@meaningoftheunicorn]

Yeah, the hammer is quite reliable. Not so much so with the hanging man. I agree with others who have said the inverted hammer is a (reasonably) reliable indicator.

[@lsenthil92]

Can we use these single candle stick patterns for intraday?how accurate are they for intraday?

[@haadisaqib1787]

NOTE: GREEN Hammer Candles is better reassurance of a reversal rather than a RED but it doesnt matter which color.. it just shows price

[@ivankatungi9542]

Where would you put your take profit

[@ArwinTorrecampo]

Hi, can this be also apply with 1day charting? Thank you.

[@davidjones2452]

Sure - although on shorter term charts, like most things, the signals will arguably not be as reliable.

[@TrunXo4]

Hi , i dont understand why u would put a stop loss above a hanging man? i was thinking a stop loss is to prevent further going down?

[@davidjones2452]

Hi, it is if you were going to go SHORT because of the hanging man i.e. selling because you think the market is going to drop. You are right that if you were already holding expecting more gains then putting a stop loss below the low would be one approach.

[@bhuralal5299]

can hanging man candle have small upper wicks?

[@bobmindyou]

What are your favorite indicators?

[@kathyfromthephilippines3230]

im a newbie, i dont understand stoploss, exit trades, does it mean when it is two ticks neaer the high i have to sell off my shares?, thats the part i get confused, entry means buying the stock,exit means selling? what part of the candle will i sell it off? thank you in advance for answering

[@Trading212]

Hello Kay, you may watch the videos on Stop Loss orders and Candlestick Charts in the channel. Here are some of them: Where to Place Your Stop Loss Order - kzbin.info/www/bejne/gYK6Y6tua6d7Z7c 3 Tips for Stop Losses - kzbin.info/www/bejne/pIvIkql_qsaLqKM The Disciplined Way To Move Your Stop Loss Order - kzbin.info/www/bejne/npyuqIOkapupo5I How to Read Japanese Candlestick Charts - kzbin.info/www/bejne/hXipqaNphc6rnZo Japanese Candlestick Basics - kzbin.info/www/bejne/jGHKo3ygps94ars Candlestick Engulfing Pattern Tutorial - kzbin.info/www/bejne/d3yyl5eGgrZ9m5o Dark Cloud Pattern for Beginners - kzbin.info/www/bejne/oau1f6V6gr2fqbs You may also start a live chat with a customer care representative, in case any particular questions arise - www.trading212.com/en/Contact?startchat.

[@Lando0o]

The hanging man when I follow it to a t usually works out still doesn’t work out every time but if your using just hanging man and hammer you don’t need to be in The markets

[@user-ge3le7qf6x]

بسیار عالی

[@winningtrade8887]

Sir pls share your chart time frame

[@Sanitarium619]

does this pattern work on all timeframes? or just daily??

[@Trading212]

Generally, it is believed that the bigger the time frame of the chart used, the more reliable the trading signals are.

[@FaraLiza]

wonder why don't you pair it with volume when studying candlestick pattern

[@FarmerJay90]

i love you

[@JustinAnsako]

Looks like pinbar?

[@ItsAboutYOUofficial]

Hi easily understandable. Can u explain how short selling work. I had AUD 3000 cash in my account. The share price was AUD 15 at that time. The market is trending downward and I decided to short sell. I wanted entire AUD 3000 to short sell. So I put the quantity to short sell as 200.(3000/15). Theoretically, my cash in the account should be zero after short selling. But another AUD 1500 was in my account. How come that be?. So I had to short sell several times to make my account zero. Can u please explain this to me?

[@Trading212]

Hi Dinindu, that is caused by the leverage when trading CFD instruments. This video sheds light on the topic - kzbin.info/www/bejne/bXS6m42ripeaaKM.

[@kunstderfugue]

Hey, can I join Trading212 from outside the UK?

[@Trading212]

Put simply, yes. Feel free to get in touch for more info - www.trading212.com/en/Contact?startchat.

[@nicolasdechantenay4628]

I have watched several videos about the "hanging man" and the "hammer", both in English and French, and i still don't get what is the difference between these two figures ? All of you are showing the same type of candles and calling them alternatively with both names !

[@Trading212]

Hi Nicolas, put simply, according to the theory, the Hammer is a signal for a trend reversal in a downward trend, hence, the beginning of an upward trend. The Hanging Man signifies a reversal in an uptrend, or the beginning of a downtrend.

[@henriqueholanda5357]

cripto live trades lets go

[@MBarberfan4life]

Thor’s hammer

[@xydoublehelix2924]

dont read this comment