A hammer is a single-candle bullish reversal pattern with a small body at the top of the bar and a long lower wick — usually at least twice the body length. It says: sellers pushed price down hard, then buyers absorbed the move and closed near the high.
Inside the hour the bar represents, sellers were in control for most of it. Price made a new low. Then somewhere in the second half, demand showed up — enough to absorb every offer and walk price back to the opening level or above. The visible artifact is that long lower wick.
That story matters more at the bottom of a downtrend than in the middle of a range. A hammer printing after three or four red bars on a key support level is a real reversal candidate. A hammer in chop is just one bar that happened to have a long wick.
The next bar's open is the first confirmation. If it gaps or trades above the hammer's high, the reversal has follow-through buyers. If it opens at or below the hammer's close, the absorption was a fakeout.
Most candlestick guides stop at "hammer = bullish, take the trade." That's why most people who trade candlestick patterns lose. Here are the situations where the hammer is a trap:
Pattern detection alone is approximately a coin flip. Thesis fires the hammer detector on every 1-hour close, then runs each candidate through a deterministic pre-filter (RSI extremes, fee-coverage math), then through an AI reasoning pass with the full context — recent price action, indicator snapshot, support/resistance, live news sentiment, market regime — before placing a real order on your broker.
The pattern is the trigger. The judgment about whether to act on it lives in the layer above. See how the AI layer works for the reasoning side, or how it's tuned for small accounts for the risk side.
Free practice mode lets you see live hammer detections before connecting a broker.
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