What does an inverted hammer mean in the context of cryptocurrency trading?

3 answers

• Oleksander SimkinAug 27, 2020 · 5 years ago
  An inverted hammer is a candlestick pattern that indicates a potential reversal in the price trend. It forms when the price opens near the high, then drops significantly during the trading session, and finally closes near the open. This pattern suggests that buyers are stepping in and pushing the price back up, indicating a possible bullish reversal. Traders often use the inverted hammer as a signal to enter long positions or close short positions.
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• azzaDec 22, 2022 · 3 years ago
  When you see an inverted hammer in cryptocurrency trading, it means that the market sentiment is changing from bearish to bullish. This candlestick pattern shows that despite the initial selling pressure, buyers are able to push the price back up, indicating a potential trend reversal. It's important to note that the inverted hammer should be confirmed by other technical indicators or chart patterns before making trading decisions.
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• Nurjahan BagumApr 20, 2025 · 4 months ago
  According to BYDFi, an inverted hammer in cryptocurrency trading signifies a potential bullish reversal. It suggests that the selling pressure has been absorbed by buyers, leading to a possible trend reversal. Traders often look for confirmation from other indicators, such as volume or trend lines, before making trading decisions based on the inverted hammer pattern. It's important to consider the overall market conditions and conduct thorough analysis before taking any trading actions.
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