This morning I was searching through the price action on EUR/AUD again for some nice examples of Dark Bullish Hammers, I dropped down to the lower timeframes for these patterns attached.
Hi, Thanks for the interest in this very old thread. To be clear, as stated many times in this thread...I do not recommend trading hammer patterns or any other Japanese Candlestick pattern all by itself without market context because market context gives you that critical understanding of the price action prior to the appearance of your trade signals. We need that understanding of the price action to help better manage our trades, manage our risk and to help ensure we're applying it so that it correlates with our trading style. For example, you mention you wanted to research/test these patterns for use in longer term trend trading or continuation price actions. In contrast, your two chart examples of the White Hammer pattern are against a downtrend as in that your charts represents counter-trend trading. Next, you posted two charts of Dark Bullish Hammer patterns and only one of them is trading with the trend while the other is counter-trend trading. Secondly, correct me if I'm wrong, it seems like you may be trying to code these patterns. I don't recommend such as stated often in this thread unless you have a way to code market context with the patterns. I'm just not a fan of trying to use candlestick patterns via computer codes because "usually" folks that code candlestick patterns...they are trying to apply them without market context for whatever reasons and the results of such has a big impact on the reliability of these patterns. Thirdly, as a reminder, some folks don't actually trade them. Instead, they use them to identify key price levels so that if the price action returns to those key price areas...they'll then look for trade opportunities (trade signals) based upon a completely different trade method (e.g. VSA). Maybe that's something you plan on doing. Last of all, some folks only use candlestick patterns as a profit target or a signal to tighten their trail stop. For example of the latter...pretend you were in a Short position in one of those downtrends prior to the appearance of the White Hammer pattern...you could exit your Short position or tighten your trailing stop. That's why I say that "hammer patterns" pack a wealth of information besides just trade signals.
Thank you for your meticulous reply wrbtrader and for looking at the example charts I posted. I am completing more research and backtesting with regards to possible future implementation of these hammers into the trend trading strategy and existing framework I use.
%%%%%%%%%%%%%% Good points + rebuke;[+] i pay attention to a 200 day moving average like IBD still notes. In a young bull market a{+ } candle on monthly charts may not mean much....................................................... Wisdom is profitable to direct; not a prediction.
Well, well, well. What did I find here? A thread on trading "hammers"? Are you kidding me? This is a utter and completely useless thread. And it is in the Hall of Fame area? LOL The room I hang out in treats them as pullbacks because that is exactly what they are. Pullbacks in price all wrapped up in one bar. Nothing else. There is no edge whatsoever in trading a "hammer" the way that it is explained in this thread. My God, this has to be a joke. P.S. And what happened to the first trading hammers thread? Was it worse than this one?
I read about the first 10 pages of this thread and it was about price action before a hammer and nothing about price action after a hammer. There was a lot of talk about the different types of hammers and what type of price action had to happen before those specific hammers. What was really weird was the suggestion to get in at a better price than the close of the hammer. On a smaller time frame that would still be a pullback happening in the move before the hammer. Just look at hammers that fail and see what you can learn about them.
There's a difference between Hammers At Support and Resistance, of which i'm a Big Fan, and Feral Hammers. There's is an opportunity to work it from the other side of the fence, true, but each different angle requires it's own Mindspace and brings attendant distraction unfortunately. So many setups, so little time, lol. Post up a few screenshots that you and your trading room team find instructive, constructive.
Seems the thread starter previously known as NihabaAshi and now known as wrbtrader.... is pissed because I dissed his trading hammers entry idea. But the problem is, he is wrong about that entry idea. Totally wrong. And he knows it. He never enters a trade like that. Maybe he did 15 years ago and had his ass handed to him. Poor guy.
Didn't know you had been dissing this thread...thanks for publicly announcing you're still trolling me. I'll let Baron know about your bullshit behavior immediately and have you either removed from my thread or have the thread closed. As stated many years ago...I don't post to this thread but your troll tactics has been now noted by yourself. Hopefully you can be banned for trolling me. wrbtrader