When a hammer is only a hammer
A hammer at support is not the same as a hammer mid-range. Here is how we teach the difference in mentorship.
Traders love naming hammers. The long lower wick feels like a story of rejection, and sometimes it is. In our private sessions we still ask the same three questions before anyone treats the bar as a reason to buy.
Prior range
If the hammer prints after a quiet drift sideways, the wick may simply reflect a brief stop-run in thin liquidity. Compare the lower wick to the average true range of the last ten bars. Oversized wicks in sleepy markets deserve suspicion.
Location
A hammer testing a weekly swing low that has held twice this quarter carries more weight than the same shape halfway through a channel. We mark the level first, then the candle.
Next bar behaviour
Mentorship clients journal what the following two candles do. A hammer that is immediately engulfed by a wide-range down bar taught more than any textbook definition.
Pattern reading is technical analysis training, not a promise. The hammer is a clue about auction behaviour — never a standalone order ticket.