The inverted hammer is the upside-down version of a hammer: a small body at the bottom of the bar, with a long upper wick. It says buyers tested higher levels intra-bar and were rejected — but the test happened at all, which is information at the bottom of a downtrend.
The bar opens, buyers push price up substantially during the session, but sellers come back in and drive the close back near the open. On the surface that looks bearish — sellers won the bar. But context matters: at the bottom of a sustained downtrend, the very fact that buyers tried is new information. The market hasn't seen real buying pressure for a while; this bar shows some.
It's called "tentative" because the close didn't hold the gains. Compare with the hammer, where the long lower wick and high close show buyers actively winning. The inverted hammer shows buyers showing up; the hammer shows them taking control.
The next bar is the test. If it opens and trades above the inverted hammer's close, the pattern confirms — sellers couldn't sustain the rejection. A close back below invalidates it.
The inverted hammer is treated as a lower-conviction signal than the hammer — same family, weaker setup. Thesis fires the detector on every 1-hour close, then runs the candidate through a deterministic pre-filter and an AI reasoning pass. Because the pattern is tentative, follow-through confirmation in the next bar's price action carries more weight here than for stronger setups.
See the hammer for the higher-conviction cousin, or how the AI layer works for what runs after detection.
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