Hammer Candlestick Forex Strategy

The Hammer candlestick is considered to be a bullish reversal pattern. It’s made up of 1 candlestick with a small body at the top and a long lower wick. The Hammer candlestick forex strategy explains how to use the Hammer candlestick in uptrending markets.

Hammer Candlestick Setup

hammer-candlestick

Chart Setup

Indicators: 100 Period Exponential Moving Average, Candlestick_Recognition_Master, William’s Percent Range (14)
Preferred time frame(s): 30 Min and higher
Trading sessions: any
Preferred Currency pairs: any

Download

Download the Hammer Candlestick Forex Strategy.

Example: EUR/USD 1 Hour Chart

forex-bullish-hammer-strategy

The chart above shows a qualified buy signal on the Euro/US Dollar hourly chart: price above the 100 exponential moving average + Hammer candlestick (HMR4)+ William’s Percent Range back above -80 from below = qualified buy signal.

Trading Rules

Qualified Buy Signal:

  • Price above the 100 EMA (up trending market)
  • William’s Percent Range indicator back above -80 from below (oversold)
  • Candlestick Recognition Master indicator shows HMR symbol (Hammer candlestick)

==> Open buy trade and place a protective stop-loss a few pips below the low of the Hammer candlestick pattern.

Qualified Buy Signal:

No sell signals from the Hammer candlestick.

Price Target: I suggest a risk-to-reward of at least 2, which means you are only risking one dollar for every two dollars of profit potential, or any other profit taking method you feel more comfortable with.

Strategy tip: Turn off all Candlestick Recognition Master indicator alerts (set to false) except the HMR 2,3,4 candlestick patterns.

Download The M1/M5 Forex Scalping Strategy Today!

This Incredible High Win Forex Scalping Strategy Will Trigger Only When There Is An Extremely High Chance Of A New Profitable Low Risk Trade To Take Place.

What are you waiting for? Start making pips today:

  • Up To 100 Pips Every Day
  • Works on all forex pairs and Bitcoin!
  • Low Risk Forex Scalping
  • Works on M1, M5 and UP