Rejection candles: hammers, stars & dojis
The candles that mark one side failing — and the location rule that makes them work.
The classic reversal candles are all the same event wearing different clothes: one side pushed, got overwhelmed, and the move was rejected. The wick is the failed attempt; the close is the counterattack.
The rejection family
- Hammer — long lower wick, close near the high, arriving after a decline. Sellers flushed price down, buyers absorbed it all and paid up into the close. The same shape after a rally means little.
- Shooting star — the mirror: long upper wick after an advance. Buyers probed higher, supply slammed it back. Most meaningful into resistance or an exhausted move.
- Doji — open and close nearly equal. Not a reversal by itself — a pause. After a long directional run, the first candle where the winning side failed to make progress; in a range, just noise.
Location is the signal
These candles only carry information where a battle was expected: at support or resistance, at a GEX wall, after an extended leg. A hammer at a level everyone is watching means trapped sellers and defending buyers. A hammer in the middle of a quiet range means someone fat-fingered an order. Same candle, different worlds.
The pattern is the entry ticket, not the trade
A rejection candle proposes; the next candles dispose. Follow-through — the market accepting the reversal by holding and extending it — is what confirms. A hammer whose low breaks two candles later was not a hammer; it was a pause in the decline.