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.
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 higher risk because of leverage.
Thanks Very Helpful
Appreciate your videos. I like the 3 monitor setup and the office vibe there.
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. 🙂
Thank you for the video you the best
IMO an inverted hammer at resistance makes much more sense than a hanging man.
I would definitely agree with you on that.
If I’m not wrong, an Inverted hammer at the top of a uptrend or at resistance level called a shooting star.
Thanks for another great video. I’ll go and check out the engulfing patterns now 👍
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.
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.
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
Always look forward to your videos, helpful as always. Thank you so much.
Hey, can I join Trading212 from outside the UK?
Put simply, yes. Feel free to get in touch for more info – http://www.trading212.com/en/Contact?startchat.
This is my favourite hammer.
Thank You very much for all the GREAT Effort you are making, hope you GREAT Sucess
Nice video. Thank you
Hi, can this be also apply with 1day charting? Thank you.
Sure – although on shorter term charts, like most things, the signals will arguably not be as reliable.
Thank you for the update.
what about when they are inverted?
does this pattern work on all timeframes? or just daily??
Generally, it is believed that the bigger the time frame of the chart used, the more reliable the trading signals are.
Hello. Please make a video about parabolic SAR
andrei catalin please, I love that indicator!
GREAT…..
cripto live trades lets go
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
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?
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.
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
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.
very nice
بسیار عالی
your videos(teaching) was really helpfull thankyou sir
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 !
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.
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
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 – https://youtu.be/KQW2x86BH1U
3 Tips for Stop Losses – https://youtu.be/nZeavIuaXrA
The Disciplined Way To Move Your Stop Loss Order – https://youtu.be/hkKwPn56vm0
How to Read Japanese Candlestick Charts – https://youtu.be/OGFxp3Pixg8
Japanese Candlestick Basics – https://youtu.be/V0grIjqjE4Y
Candlestick Engulfing Pattern Tutorial – https://youtu.be/AKOfdPMQJe8
Dark Cloud Pattern for Beginners – https://youtu.be/kzRNrDMXlsY
You may also start a live chat with a customer care representative, in case any particular questions arise – http://www.trading212.com/en/Contact?startchat.
What are your favorite indicators?
i love you
Where would you put your take profit
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?
Hi Dinindu, that is caused by the leverage when trading CFD instruments. This video sheds light on the topic – https://youtu.be/7CWjZuU2g2A.
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.
Thanks for telling us at the end about making sure the bell is clicked to get notifications. I didnt know that. 🙂
thanks, David & 212 for amazing video tips for trading
Looks like pinbar?
Thank you from Bali
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.
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
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.
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?
You are without a doubt one of the best YouTubers regarding Forex trading. I truly appreciate your videos, as I am so new to this profession.
Does the hammerhead candlestick reversal also mean a reversal if the share is trading sideways?
Sir pls share your chart time frame
dont read this comment
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?
NOTE: GREEN Hammer Candles is better reassurance of a reversal rather than a RED but it doesnt matter which color.. it just shows price
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?
Thank you so much.
Can we use these single candle stick patterns for intraday?how accurate are they for intraday?
Thank you very much. It was amazing.
Thor’s hammer
The hammer like the engulfing candlestick strategies are useful for intraday trading or only for multiday trading? Thanks
Thank you
can hanging man candle have small upper wicks?
Very appreciative of the information you present. I am always watching your videos and taking notes
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.
Thanks David
thank you
Good one
Thank you this was 🔥🔥🔥🔥