Next to the Doji, the most significant single candle patterns are the Hammer and Hanging Man. It's easy to confuse these, as they look the same. They are a short real body with no or little upper shadow but a long lower shadow. The difference is that the Hammer comes at the end of a downtrend, and the Hanging Man occurs in an uptrend.

Note: Hanging Man / Hammer are very similar to spinning tops but as you can see the small body lies at the top of the candle with a small upper shadow and a much longer lower shadow. Sometimes there may not be an upper shadow. When you see that at the bottom of a downward trend it is called a hammer and generally denotes a potential change in the direction of trend. On the opposite end if you find a candle like this at the top of an upward trend it's called a hanging man and will signal a potential change in trend again.

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