(Hammer Candlestick)
🔨 How to use the "Hammer Candle" to make smart trading decisions?
📌- Appears after a downtrend: An indication of trend reversal.
This candle is a sign of hope at the end of the downtrend! Here’s how to use it:
🎯 Trading Strategy:
1. Confirmation:
- Wait for a bullish candle to appear after the hammer (like a green candle closing above the hammer's opening price).
- Ensure that trading volume is high during the formation.
2. Entry Point:
- Enter a buy when breaking short-term resistance or when the next candle closes above the body of the hammer.
3. Stop Loss:
- Place the "stop loss" below the low of the shadow.
- Stick to the 10% rule (do not risk more than 10% of your capital on the trade).
🚨 Warning:
The hammer candle indicates a potential reversal of the downtrend, but its success depends on proper confirmation and risk management.
💡 Expert Advice:
The hammer alone is not enough! Avoid trading without confirmation or a risk management plan.
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