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October 4, analyst Joseph: The question in the interest rate market now is not whether the Fed will raise interest rates because of these data, but whether the Fed will only cut interest rates by another 50 to 100 basis points, rather than the 200 basis points expected before the release of this non-farm report. Given these data, the expectation of a 50 basis point rate cut in the near term is unlikely to be reflected in market pricing in the short term.On October 4, analyst Nour said that the dollar rose to an intraday high after the United States released shocking employment data. As long as the "exceptionalism" of the US economy continues to suppress bets on the Feds rate cuts, the dollars gains can continue further. "While I supported the bearish view on the dollar on Thursday, my view on the interest rate differential supports my current view. The market has reduced its bets on the expected extent and speed of interest rate cuts. If next weeks CPI data consolidates the expected shift, the dollars short-term gains are likely to continue because it is supported by the interest rate differential." As the eurozone economy struggles, the ECBs easing policy, even if matched by the Fed, will be affected by concerns about fiscal and economic aspects, which is unfavorable for the euro.The European Central Bank has warned banks that they could face more fines over their management of climate risks.Traders erased bets that the Federal Reserve would cut interest rates by 50 basis points in November.On October 4, after the release of the non-agricultural data, Principal Asset Management analyst Seema Shah joked that the Fed will have to turn its attention to inflation. "Does the Fed need to cut interest rates in September? Not to mention a 50 basis point cut." This surprising upward surprise suggests that the job market may actually be a picture of strength rather than weakness, and it completely refutes the view that the Fed may even consider cutting interest rates by 50 basis points again in November. As shown by initial claims, the "Challenger" survey and a large number of strong economic data, the US economy remains strong. With the Fed implementing policy easing, the risk of a recession has disappeared. The market needs to keep a close eye on inflation because there are policy risks on both sides of the economy.

What is a Hammer Candlestick Chart Pattern?

Ralph Graves

Jan 06, 2022 11:18

Among the traditional candle holder charting patterns, a hammer is a turnaround pattern including a solitary candle with the appearance of a hammer. Determining hammer candle holder patterns can aid traders determine possible price turnaround locations.

 

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Hammer candles are formed when the open, high and close are similar in worth, however a long wick, or shadow, shows that the price got to considerably reduced values before the candle closed. Hammer candles can appear as either red or eco-friendly candles, with the most certifying aspect being the ratio of the darkness to the body of the candle. The accepted criterion amongst technological traders is that the wick below the body of the candle be at the very least 2 times as long.

 

Hammer candles can take place on any kind of timeframe as well as are used by both short and long-term investors.

Bullish Hammer 

In the example below, a hammer candle can be found on the everyday Cisco Systems (CSCO) graph and rate begins to alter direction immediately complying with.


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Bearish Hammer (Hanging Man) 

When a hammer candle shows a bearish turnaround, it is referred to as a hanging man. In the example below, a bearish hammer candle appears in the direction of the top of an uptrend on a 5-minute IBM chart and rate relocations downward adhering to the pattern. 


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Inverted Hammer Candles

Inverted hammer candles develop when the open, low and also close of the candle are similar in value but cost reached greater values before the close of the candle. Comparable to traditional hammer candles, they can happen as both eco-friendly as well as red candle lights as well as aid to determine rate reversals.


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Bullish Inverted Hammer 

In the instance below, an inverted hammer candle is observed on the daily Natural Gas Futures graph as well as price starts to alter fad later on.


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Bearish Inverted Hammer (Shooting Star) 

When an inverted hammer candle is observed after an uptrend, it is called a shooting star. In the 5-minute Starbucks (SBUX) graph below, a bearish inverted hammer denotes a change in fad.


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Limitations of the Hammer Candlestick Pattern

While the hammer candle holder pattern can be beneficial to investors of all tools and durations, it can be undependable as a standalone evaluation tool. Confirmation with various other indicators as well as market analysis tools can help to validate or deny a profession thesis based on a hammer candle. 

Difference Between Hammer Candle & Doji

A doji is a similar sort of candle holder to a hammer candle, but where the open and close price of the bar are either the exact same or very enclose worth. These candles signify indecisiveness in a market and can signal both price reversals as well as trend continuations.

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