💀 Hanging Man Candlestick Pattern – Bearish Reversal Signal

The Hanging Man is a single-candle bearish reversal pattern that forms after an uptrend. It signals potential exhaustion of buying pressure and the start of a bearish reversal as sellers begin to appear strongly in the market.

📘 What Is the Hanging Man Pattern?

The Hanging Man is a candlestick pattern that appears at the top of an uptrend. It has a small real body near the top of the trading range and a long lower shadow that’s at least twice the length of the body. This shape shows that sellers tried to push the price down significantly during the session, but buyers managed to pull it back up — yet the selling pressure is a warning sign.

• Occurs at the end of an uptrend.
• Has a small body (bullish or bearish) near the top of the range.
• Has a long lower shadow — at least twice the body height.
• Little or no upper shadow.
  
  
  

💡 Market Psychology

The Hanging Man pattern reveals that selling pressure is emerging. Even though buyers pushed prices higher initially, the long lower wick shows strong selling during the session. If the next candle closes lower, it confirms the reversal and signals the bulls are losing control.

⚠️ Confirmation: The pattern is only valid if followed by a bearish candle on the next session.

⚙️ How to Trade the Hanging Man

1. Identify the pattern at the top of an uptrend.
2. Wait for confirmation with a bearish candle closing below the Hanging Man’s body.
3. Enter a sell (short) trade after confirmation.
4. Place a stop-loss above the high of the Hanging Man candle.
5. Set your target based on the next support or 1:2–1:3 risk/reward ratio.
   
   
   

🏁 Conclusion

The Hanging Man candlestick pattern is a warning sign that an uptrend might be losing strength. When confirmed with bearish follow-up candles or volume increase, it can help traders identify a potential reversal early.

“When the Hanging Man appears — the uptrend may be nearing its end.”