Rastani almost did not see this odd bitcoin pattern, which he calls a hammer candlestick pattern. According to Wikipedia a hammer candlestick pattern is:
...a type of bullish reversal candlestick pattern, made up of just one candle, found in price charts of financial assets. The candle looks like a hammer, as it has a long lower wick and a short body at the top of the candlestick with little or no upper wick. In order for a candle to be a valid hammer most traders say the lower wick must be two times greater than the size of the body portion of the candle, and the body of the candle must be at the upper end of the trading range.
When you see the hammer form in a downtrend this is a sign of a potential reversal in the market as the long lower wick represents a period of trading where the sellers were initially in control but the buyers were able to reverse that control and drive prices back up to close near the high for the day, thus the short body at the top of the candle.
After seeing this chart pattern form in the market most traders will wait for the next period to open higher than the close of the previous period to confirm that the buyers are actually in control.Does this mean that we're going to start seeing a consistent upward trend going forward? Rastani says we need to see further buying strength before we will have confirmation that we're heading back into a bullish trend.
What do you think about this? Are you optimistic about it? Let us know your thoughts in the comments.