The hammer shape — small body up top, long lower wick — but appearing after an uptrend, warning the rally may be tiring.
Sellers managed to drive price sharply lower during the session before it recovered. Occurring at the top of an advance, it hints that supply is starting to appear.
It is a potential bearish reversal. Confirmation is a lower close the following candle; without it the pattern often fails.
Small body in the upper part of the range, long lower shadow (roughly twice the body), little upper wick, after a clear uptrend. Its shape is identical to the hammer — location flips its meaning.
Never trade a single candle in isolation. It only carries weight with context — location at a key level, the prevailing trend, and confirmation from the next candle or from volume. On its own it is a hint, not a signal.
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