PSEi - hammer?

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PSEi = 3168.3 ()

PSEi formed a gap down black candle with long lower shadow. Volume increasing

PSEi seems to be forming a hammer. Which could have bullish implications since it is a reversal signal. A reversal from an obvious downtrend to either a consolidation or uptrend.

The hammer can be confirmed if the PSEi manages to form higher lows and higher highs with significant volume.

Bear in mind that this is what I see with regards to the PSEi candle stick chart. If we factor in the decline of the US market last Friday, the sentiment on opening day of trading would most likely be mixed and with bearish pressures.

But I am still hoping that the hammer formation is fulfilled.

Let us review:

Hammer = takuri (in Japanese) which means: "trying to gauge the depth of the water by feeling its bottom"

{for the DOM's out there the bottom of the trend, not the juicy ones :) } hehehe



The hammer can be recognized by three criteria:

1. The real body is at the upper end of the trading range. The color of the real body is not important.

2. A long lower shadow should be twice the height of the real body.

3. It should have no, or very short, upper shadow.

- taken from "Japanese Candlestick Charting Technique by Steve Nison" (a link to buy the book through Amazon is provided on the left column/section)


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