Hanging Man
A hanging man looks identical to a hammer (small body at top, long lower wick) but appears after an uptrend instead of a downtrend. It's a bearish warning signal.
Understanding the Concept
Same shape, opposite meaning. The hanging man shows that even though price closed near its high, sellers pushed it down significantly during the session. That selling pressure at the top of an uptrend is concerning. It suggests the rally might be running out of steam. Like most candlestick patterns, confirmation is essential—wait for the next candle to close lower before acting. A hanging man at resistance is more significant than one in the middle of a trend.
Real-World Example
After Solana rallies from $80 to $120, a hanging man forms at $120: opens at $119, drops to $112, closes at $118. The next day gaps down and closes at $115. The rally is over.
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