What is a Hanging Man Candlestick?
A hanging man candlestick occurs during an uptrend and warns that prices may start falling. The candle is composed of a small real body, a long lower shadow, and little or no upper shadow. The hanging man shows that selling interest is starting to increase. In order for the pattern to be valid, the candle following the hanging man must see the price of the asset decline.
KEY TAKEAWAYS A hanging man is a bearish reversal candlestick pattern that occurs after a price advance. The advance can be small or large, but should be composed of at least a few price bars moving higher overall.
The candle must have a small real body and a long lower shadow that is at least twice the size as the real body. There is little or no upper shadow.
The close of the hanging man can be above or below open, it just needs to be near the open so the real body is small.
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