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Combining Bollinger Bands with hammer and inverted hammer candlestick patterns creates a powerful trading strategy that blends volatility analysis with price action signals.

Open Account: http://pocketoptioncapital.com

Bollinger Bands help traders identify periods of high and low volatility by plotting a simple moving average along with upper and lower bands set two standard deviations away. When price touches or breaches the lower Bollinger Band, it can signal potential oversold conditions—an ideal setup for spotting bullish hammer candles. A hammer forming at the lower band indicates strong buying pressure and a possible bullish reversal, making it a prime entry signal.

On the other hand, an inverted hammer that appears near the lower Bollinger Band can also suggest a potential trend reversal, but with a slightly different sentiment. While it still indicates buying interest after initial selling pressure, confirmation is crucial—typically in the form of a strong bullish candle that follows. The inverted hammer is especially valuable in a downtrend, where it acts as a warning shot that bears are losing momentum. When paired with a squeeze in Bollinger Bands (indicating low volatility), a breakout following the inverted hammer can result in explosive upward moves.

To strengthen trade setups using these tools, traders often look for confluence zones—areas where the lower Bollinger Band, support levels, and hammer-like candles align. This multi-layered approach reduces false signals and enhances probability. Conversely, if a hammer or inverted hammer forms at the upper Bollinger Band, it may indicate exhaustion in an uptrend and a possible reversal or pullback. By integrating candlestick psychology with volatility dynamics, traders can time entries and exits with greater precision and manage risk more effectively.

Open Account: http://pocketoptioncapital.com

Money Management:
It is important to follow up with this strict rule of investment:
If you have $100 in your account, each open position should be $5 tops
If you have $200 in your account, each open position should be $10 tops
If you have $500 in your account, each open position should be $25 tops
If you have $1,000 in your account, each open position should be $50 tops
If you have $2,000 in your account, each open position should be $100 tops
If you have $5,000 in your account, each open position should be $250 tops

We're currently in our 13th year helping traders become successful in the live markets so we know a thing or two about leveraging a small account into serious wins.

Risk Disclaimer:
Trading options involves financial risk and may not be appropriate for all investors. The information presented here is for information and educational purposes only and should not be considered an offer or solicitation to buy or sell any financial instrument. Any trading decisions that you make are solely your responsibility. Past performance is not necessarily indicative of future results.

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Transcript
00:00Today, I'm going to show you one of the most powerful candlestick strategies out there.
00:05The hammer and inverted hammer trading strategy. This method is easy to learn,
00:10works in almost any market, and is perfect even if you're just starting out. So don't skip even a
00:16second, because one small detail could be the key to catching a winning trade. But first,
00:21a quick reminder. Trading binary options carry significant financial risk, and you could lose
00:27money. This video is for educational purposes only, and not financial advice. Past performance does not
00:33guarantee future results. Always trade responsibly, never risk money you can't afford to lose,
00:39and do your own research before making any trading decisions. Before we dive in. If you're new here,
00:45hit that subscribe button and turn on the notification bell so you don't miss out on
00:49new strategies, tips, and live examples that can help your trading journey.
00:53Let's talk about the tools you'll need for this strategy. For this setup, we're going to keep
00:59things super simple and effective. Candlestick patterns. We'll be using two powerful candlestick
01:05signals. The hammer, a sign of possible bullish reversal. The inverted hammer, a sign of potential
01:13bearish reversal. Indicator. To filter out low-quality signals, we'll use the Bollinger Bands indicator with
01:20default settings. That's it. No complicated tools or cluttered charts. Now, let's break down the
01:27trading rules. Sell trade setup. Look for a clear inverted hammer candlestick on your chart. The
01:33candle must touch or slightly cross the upper Bollinger band. If these two conditions are met,
01:38take a sell trade. Quick tip, avoid taking the trade if the market is already in a strong uptrend.
01:45Buy trade setup. Spot a firm hammer candlestick on the chart. The candle should touch or dip below the
01:51lower Bollinger band. If both match, go for a buy trade. Again, stay away from trades if the chart is
01:58moving strongly in just one direction. Time frame and expiry settings. Use one-minute candlesticks.
02:05Set your trade expiry to one minute as well. This setup works well for quick entries and exits,
02:10especially in binary trading. Best times to trade, European session and New York session. Avoid
02:16trading during major news events. Price can become unpredictable. Risk management tips. Only risk
02:24between 1% to 5% of your account per trade. Never risk more than 10% of your total capital. Make sure you
02:33first practice this strategy using a demo account. Also, backtest it thoroughly on historical charts to
02:40better understand market conditions and boost your confidence before you risk real money.
02:45Check the video description for extra tips and step-by-step details.
02:49Now let's jump into a live trade example so you can see this strategy in action.
02:54Keep watching. You don't want to miss this.
02:59Alright traders, here we are on the chart. I've taken a buy trade based on all the rules we discussed.
03:04A strong hammer candlestick pattern has formed. It's clearly touching the lower Bollinger band.
03:10And most importantly, the market is not in a strong trend, which is exactly what we want for this
03:15strategy. Now we just wait and see how this trade plays out. While we wait for the result. If you have
03:21any questions about this strategy, whether it's about the candlestick patterns, Bollinger band setup,
03:27or entry timing, feel free to drop them in the comments below. I read every comment and try my best to
03:34answer as many as I can. Okay, let's check back in on our trade now. Great news. We won this trade.
03:43That was a clean setup and a solid example of how well this strategy can work when all the conditions
03:49are met. Now let's wait for the next perfect trade setup. So right now I've entered a buy trade following
03:57all the strategy rules. We got a firm hammer candlestick on the chart. The candle clearly
04:03touched the lower Bollinger band and the market is not in a strong trend, which is exactly what we want.
04:09Everything looks good. So now we just need to be patient and wait for the result. Trading tip while we
04:15wait. One of the most important skills in trading is waiting for the right moment. Many traders lose money,
04:21not because of bad strategies, but because of impatience or over trading. Don't trade just to trade. Only enter
04:28when your setup matches your plan. Almost there. Perfect. We've won this trade. That's a great example
04:36of how sticking to the rules can lead to consistent results. Now let's get back to the chart and patiently
04:42wait for the next perfect trade setup. In this case, I've taken a sell trade based on the exact strategy rules
04:49we discussed earlier. We've got a strong inverted hammer candlestick on the chart. The candle clearly
04:55touched the upper Bollinger band and the market is not showing a strong trend. Just the way we want it.
05:01So everything lines up perfectly. Now we'll do what smart traders always do. Wait calmly and let the trade
05:08play out. While we wait, let me remind you, patience is a big part of this strategy. We don't chase trades.
05:16We follow a process, clear signals, confirmed setups, and controlled risk. If you ever feel unsure before
05:23placing a trade, don't take it. It's better to skip a setup than to regret a rushed decision. The market
05:30always gives more chances. You just need to be ready. Also, if this is your first time using the inverted
05:37hammer plus Bollinger band strategy, I highly recommend testing it on a demo account first. Get comfortable,
05:45practice, and backtest before risking real money. Another win. That's a wrap for today's trade. We
05:51used the inverted hammer candlestick, confirmed it with the upper Bollinger band, made sure the
05:56market wasn't strongly trending, and the result? A solid win. Let's quickly recap what we learned today.
06:03Use the hammer for buy trades and inverted hammer for sell trades. Confirm with Bollinger bands. Lower
06:09band for buy. Upper band for sell avoid. Strong trending markets use a one-minute time frame with
06:16one-minute expiry always trade during the best market hours and avoid high-impact news. If you
06:22learned something new today or found this strategy helpful, do me a quick favor. Like the video,
06:28subscribe to the channel, and share this with a fellow trader who might benefit from it. Also, check the
06:33video description for more tips, extra notes, and links to helpful tools that can support your trading
06:39journey. Thanks for watching till the end. I truly appreciate your time. Until next time, trade safe,
06:46stay focused, and keep growing. See you in the next video.

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