The hammer and shooting star are single-candle patterns defined by the same basic shape — a small real body with one long wick — but they carry opposite meanings depending on where they appear and which side the wick is on.
The Shape: A Small Body, A Long Wick
Both patterns share a small body near one end of the candle's range, with a wick at least twice the length of the body extending the other way. That long wick is the entire story: it shows price traveled a significant distance in one direction during the session, only to be pushed most of the way back before the close.
The Hammer Pattern
A hammer forms after a decline: a small body sits near the top of the candle's range, with a long lower wick beneath it. It shows sellers pushed price sharply lower during the session, but buyers stepped in hard enough to reclaim most of that move by the close — a sign of demand reappearing after a downtrend, especially when it forms at a support level.
The Shooting Star Pattern
A shooting star is the mirror image, forming after a rally: a small body sits near the bottom of the candle's range, with a long upper wick above it. Buyers pushed price sharply higher, but sellers took most of it back by the close — a sign that upside momentum is meeting real resistance, especially near a known resistance level.
The color of the small body (green or red) matters far less than its size and position relative to the wick. A hammer with a small red body still carries the same bullish read as one with a small green body — it's the rejection shown by the long wick that drives the signal, not the body's color.
A Note on the Inverted Hammer and Hanging Man
Two closely related shapes share the same "small body, one long wick" structure but appear in the opposite trend context:
- Inverted hammer: Looks like a shooting star (long upper wick), but forms after a decline rather than a rally — a tentative, less confirmed bullish signal than a standard hammer.
- Hanging man: Looks like a hammer (long lower wick), but forms after an advance rather than a decline — a tentative bearish warning rather than a confirmed reversal.
Both are weaker versions of their counterparts and generally require more confirmation before being traded.
What the Long Wick Actually Represents
A long wick is a direct, visible record of rejection. Price tested a level, and the market decisively pushed back — whether that's sellers overwhelming an attempted rally (shooting star) or buyers overwhelming an attempted decline (hammer). That rejection is exactly the kind of behavior traders look for at meaningful support and resistance levels, where it carries far more weight than the same shape appearing in the middle of an unremarkable range.
Confirming the Signal
Neither pattern is typically traded in isolation. The standard approach is to wait for the next candle to close in the direction the wick suggests — a green candle after a hammer, or a red candle after a shooting star — before treating the reversal as confirmed. This mirrors the same confirmation discipline used with a doji: the pattern flags a possible turning point, but the next candle is what actually confirms it.
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