Hanging man is one of the bullish trend reversal pattern in Candlestick Analysis. It is made up of just one candlestick candle. The candle will be formed after a sharp price rally in the underlying stock. Hanging man is just opposite of Hammer, wherein it will be formed after share cut in the price.
Candlestick Charts showing Hanging Man
It will have long upper shadow and small red or green body. The size of the shadow should be at least 2 times of the body. The long shadow implies the sellers were dominating the stock and took it the day's low. However the buyers had enough strength to pullback the price close to its open price. The pullback shows the strength of the buyers, but the question here is, will the strength be continued for subsequent days. Most of the time the answer is simply “No”.
Hanging Man in the moving average lines and any resistance with volume will be in-tact.