Every candlestick is a report. The body tells you where price opened and closed. The wicks tell you where price tried to go — and failed.
A wick is not a mistake. It is a record of a battle. When price extends upward and then pulls back to close lower, sellers defeated buyers at that level. When price extends downward and then recovers to close higher, buyers defended the level against sellers. The wick marks the exact price where the winning side stepped in.
This lesson covers five wick-based patterns: Hammer, Hanging Man, Inverse Hammer, Shooting Star, and Pin Bar. All five share the same underlying principle — a long wick shows that price explored a level but was rejected. What distinguishes each pattern is where that rejection occurs and which direction it signals.
What Wicks Tell You
When a candle closes, its wick tells you one of two things.
An upper wick means price traded above the closing level during the session, but sellers pushed it back down before the close. The longer the upper wick, the stronger the selling pressure at that level. Sellers were not just present — they were aggressive enough to reverse price from its highs.
A lower wick means price traded below the opening level during the session, but buyers absorbed the selling and pushed price back up before the close. The longer the lower wick, the stronger the buying pressure at that level. Buyers stepped in, absorbed every sell order, and drove price back up within a single candle's timeframe.
This is why wicks are signals and not noise. They document a specific event: price reached a level, one side dominated, and the session closed against the extreme. That sequence of events — test, response, rejection — is what gives wick patterns their predictive value.
The location of the rejection matters as much as its size. A lower wick at a known support level is a high-probability bullish signal. The same lower wick in the middle of an uptrend with no nearby support tells you nothing reliable. Context and location are inseparable from the wick pattern itself.
The Wick Ratio Rule
Not every long wick is a tradeable signal. To qualify as one of the five patterns in this lesson, a wick must meet a minimum size requirement.
The wick must be at least 2 times the length of the body.
If the candle body spans 5 points and the wick spans only 6 points, the ratio is 1.2 — too small. Sellers tested higher prices but were not convincingly rejected. The signal is weak. For a wick to represent genuine rejection, the body should appear small relative to the wick — ideally the body takes up one-third or less of the total candle length.
The ideal pattern has a small or minimal body (the open and close are very close together) and a wick that extends significantly in one direction. When the body is large relative to the wick, you are reading a momentum candle, not a rejection candle. These are different signals and should not be traded the same way.
A small body means the session ended approximately where it started. Combined with a long wick, that tells you: price tried to move aggressively in one direction, was completely rejected, and the session closed as if the attempt never happened. That is a powerful signal about who controls that price level.
Lower Wick vs Upper Wick Patterns
The five patterns in this lesson split into two groups based on wick direction.
| Lower Wick Patterns — Buyers Rejected Lower Prices | Upper Wick Patterns — Sellers Rejected Higher Prices | |
|---|---|---|
| Patterns | Hammer at Support, Inverse Hammer, Pin Bar at Support | Hanging Man at Resistance, Shooting Star |
| Wick direction | Downward (lower wick) | Upward (upper wick) |
| What it shows | Buyers absorbed selling pressure and defended the level | Sellers overwhelmed buyers and rejected higher prices |
| Signal context | At or near identified support zones | At or near identified resistance zones |
| Typical bias | Bullish reversal or continuation | Bearish reversal |
The critical observation is that wick direction and pattern location must align with each other and with the intended trade direction. A lower wick pattern at resistance is not a bullish signal — it signals that buyers tried to hold a resistance zone and failed. Always read wick patterns in relation to the surrounding structure.
Hammer and Hanging Man
The Hammer and Hanging Man are visually identical. Both have a small body near the top of the candle range and a long lower wick. They are two names for the same shape — what changes is where the shape appears.
Hammer at Support (#31) appears after a downtrend or at an identified support level. The small body sits near the top of the candle. The long lower wick shows that sellers drove price significantly lower during the session, but buyers absorbed all of that selling and pushed price back up to close near the high. This is the buyers' counter-attack. At support, the Hammer signals that the level held and a bullish reversal or bounce is probable.
Hanging Man at Resistance (#32) appears after an uptrend or at an identified resistance level. The shape is identical — small body at the top, long lower wick. But the context reverses the signal entirely. At resistance, the lower wick shows that selling pressure is already present. Despite closing near the high, sellers were able to push price down significantly within the session. The next candle often continues lower. The Hanging Man warns that the uptrend may be exhausted.
The win rates are identical because the patterns share the same shape and the same statistical behaviour — applied in opposite directions. Both improve significantly as timeframe increases. On the daily chart, a confirmed Hammer at support achieves 72% reliability, making it one of the more dependable single-candle reversal signals in this course.
Inverse Hammer and Shooting Star
The Inverse Hammer and Shooting Star are also visually identical — and again, location determines the signal.
Inverse Hammer (#33) appears at support or after a downtrend. The small body sits near the bottom of the candle range. The long upper wick shows that buyers drove price significantly higher during the session, but were pushed back down before the close. At first glance this looks bearish — buyers failed to hold the high. But at support, the upper wick demonstrates that buyers exist and are active at this level. They attempted to push price higher and had enough strength to create a significant upper wick, even if they could not hold it. This is a preliminary signal that buying pressure is building.
Shooting Star (#34) appears at resistance or after an uptrend. The shape is the same — small body near the bottom, long upper wick. At resistance, the interpretation reverses. Price attempted to break above resistance during the session, was aggressively rejected by sellers, and closed near the session low. The upper wick is a record of failed breakout attempts. Sellers controlled the level, and the Shooting Star signals that the uptrend is likely ending.
Note that the Inverse Hammer is weaker than the Hammer as a bullish signal. A lower wick at support is a more direct demonstration of buyer strength than an upper wick at support. The Inverse Hammer is a preliminary warning, not a confirmed entry signal — it requires a strong bullish follow-through candle before entry is warranted.
Both the Inverse Hammer and Shooting Star post slightly lower win rates than their Hammer/Hanging Man counterparts. The reason is indirect evidence: an upper wick at support hints at buyers, but a lower wick at support proves it. Treat the Inverse Hammer and Shooting Star as high-value confirmation signals rather than primary entry triggers.
Pin Bar — The Strongest Rejection Signal
The Pin Bar (#8) is the highest-performing pattern in this lesson. It is not a separate shape — it is a Hammer or Inverse Hammer that meets stricter criteria, appears at a more significant level, and produces a more pronounced rejection.
What distinguishes a Pin Bar from a standard Hammer or Shooting Star:
- The wick is typically 3 times or more the body length (stricter than the 2× rule)
- The body is very small — sometimes nearly a Doji — positioned at one extreme of the candle
- The candle occurs at a major key level: a multi-week support or resistance zone, a Fibonacci retracement, a prior swing high or low
- The nose (the wick tip) protrudes clearly beyond surrounding candles, showing that price tested a level no other recent candle reached
The combination of extreme wick length, minimal body, and placement at a significant level is what gives the Pin Bar its higher win rate. It is the market's clearest statement that a level was tested and definitively rejected.
The Pin Bar outperforms the Hammer on 1-hour, 4-hour, and daily timeframes — the timeframes that matter most for reliable trading. On the 5-minute chart, both patterns perform similarly (the noise level is roughly equal). On the daily chart, the Pin Bar at 75% outperforms the Hammer at 72% because the stricter criteria filter out marginal setups. When you see a textbook Pin Bar on a daily chart at a major key level, it is one of the highest-probability single-candle setups available.
Hammer at Support and Shooting Star at Resistance — Chart Example
The chart below shows a 10-day price sequence with both a Shooting Star at resistance and a Hammer at support. Both patterns are marked with entry indicators.
Hammer at Support and Shooting Star at Resistance
On January 10, price reached toward resistance and closed well below the session high — a Shooting Star formation. The upper wick extended toward the 195 resistance zone. After this candle, price declined steadily over six sessions.
On January 18, price reached toward the 179 support level and closed near the session high — a Hammer. The lower wick probed significantly below support before buyers recovered the candle. January 19 confirmed the signal with a strong bullish close, providing the entry trigger. The Hammer itself is never the entry. January 19 is the entry.
Confirmation — What to Look For After Each Pattern
Wick patterns tell you where a battle occurred. Confirmation tells you who won. The pattern candle alone does not prove the outcome — the following candle does.
After a Hammer at Support: wait for the next candle to close above the Hammer's body. This confirms that buyers held the level and are now pushing higher. Entry is on the close of the confirmation candle. Stop goes below the Hammer's low — the exact level buyers defended.
After a Hanging Man at Resistance: wait for the next candle to close below the Hanging Man's body. This confirms that sellers have regained control. Entry is on the close of the confirmation candle. Stop goes above the Hanging Man's high.
After an Inverse Hammer at Support: the follow-through candle needs to be significantly bullish — ideally an engulfing candle or a strong close above the Inverse Hammer's high. A weak follow-through is not enough because the original pattern already showed mixed buyer strength.
After a Shooting Star at Resistance: wait for a bearish close below the Shooting Star's body low. Volume on the Shooting Star itself is a useful indicator — high volume increases the probability that sellers are genuinely committed.
After a Pin Bar: the confirmation bar is still required, but the required move is smaller given the Pin Bar's stronger initial signal. A close above the Pin Bar's body high (for bullish) or below the Pin Bar's body low (for bearish) is sufficient.
In all five cases, the pattern identifies the level. The confirmation candle provides the entry trigger. Trading the pattern itself — before confirmation — is one of the most common and preventable mistakes new traders make with wick patterns.
Why does the same wick shape mean different things at support vs resistance?
The shape records the price move during the session. Context — specifically, whether price is at a known support or resistance zone — determines the interpretation. A long lower wick at support proves that buyers defended that specific level. The same lower wick in the middle of a trend, away from any key level, does not show defence of a level — it shows a temporary dip with no structural significance. Location turns an observation into a signal. Without a nearby key level, a wick pattern has no predictive meaning.
Can I use wick patterns on every asset class?
Yes, with one caveat: the win rates in this course are derived primarily from equity and forex data. Crypto assets tend to show lower wick pattern win rates on shorter timeframes (5m, 15m) because of higher volatility and thinner order books, which produce more false rejection signals. On 4-hour and daily crypto charts, the patterns perform comparably to equities. For futures and commodities, the patterns perform well but session timing matters — wick patterns forming near session open or close on futures markets have lower reliability than those forming mid-session.