Inverted Hammer Pattern

Inverted Hammer is one of the commonly used candlestick patterns in quantitative trading, representing a bullish reversal pattern.

Calculation Principle

Inverted Hammer pattern is identified by the following conditions:

1. Opening and closing prices are very close
2. Upper shadow is at least twice the length of the body
3. Lower shadow is very short or non-existent
4. Very small body
5. Pattern appears at the bottom of a downtrend

Parameter Description

• Input Parameters:
  • Open: Opening price
  • High: Highest price
  • Low: Lowest price
  • Close: Closing price
• Parameters:
  • penetration: Body penetration ratio (default: 0)

Usage Recommendations

1. Use in combination with other technical indicators
2. Pay attention to the overall market trend
3. Monitor volume confirmation
4. Set reasonable stop-loss levels
5. Watch for false breakouts

Notes

• Ensure data quality
• Pay attention to pattern completeness
• Consider market environment
• Watch for false signals
• Combine with fundamental analysis
• Pay attention to risk control
• Regularly evaluate strategy effectiveness
• Optimize parameters