Hanging man candlestick: does a fall follow?
A hanging man is the same shape as a hammer, a small body with a long lower wick, but it appears after a rise. It shows sellers were able to push price well down during the day.
When “Hanging man” appeared, NIFTY 200 stocks were lower 12 trading days later 45.7% of the time, against 44.7% after any day: about the same as picking a random day.
| After | Higher | Average move | Median move | Higher after any day |
|---|---|---|---|---|
| 5 trading days | 54.1% | +0.4% | +0.4% | 53.9% |
| 12 trading days | 54.3% | +1.2% | +0.7% | 55.3% |
| 20 trading days | 56.1% | +1.8% | +1.4% | 56.8% |
Year by year
| Year | Signals | Higher after 12 days | Any day |
|---|---|---|---|
| 2021 | 41 | 48.8% | 54.4% |
| 2022 | 121 | 44.6% | 52.1% |
| 2023 | 156 | 69.2% | 61.3% |
| 2024 | 168 | 48.2% | 53.7% |
| 2025 | 81 | 55.6% | 53.1% |
| Large cap only | 299 | 54.8% | |
| Mid cap only | 268 | 53.7% |
What it is
A hanging man is the same shape as a hammer, a small body with a long lower wick, but it appears after a rise. It shows sellers were able to push price well down during the day.
How we detected it
The same shape as a hammer: the lower wick is at least twice the body, the upper wick is no more than 10% of the range or half the body (whichever is larger), the body is more than 5% of the range, and the range is at least 0.8 times the average daily range of the 14 sessions ending three days earlier. The close rose more than 2.5% over the 8 days before it. We count the day it forms.
How traders read it
On its own it is a weak warning, because buyers still closed the day near the high. Traders wait for the next candle to close below the hanging man’s body.
A signal is a probability, not a promise
Even the most reliable signal in this study was followed by the opposite move 37% of the time. A signal tilts the odds; it doesn’t decide the outcome.
Signals work better when they agree with the trend and with each other. Whatever the signal, decide your stop-loss before you act.
Practise spotting it, free
The Hammer and hanging man chapter teaches this signal in five minutes, then you call real NSE charts and get graded on your reasoning.
Common questions
Does the hanging man signal work on Indian stocks?
When “Hanging man” appeared, NIFTY 200 stocks were lower 12 trading days later 45.7% of the time, against 44.7% after any day: about the same as picking a random day. No single signal is reliable on its own; traders combine it with the trend and manage risk with a stop-loss.
How often did stocks rise after this signal?
Across 567 signals on 166 NIFTY 200 stocks (2021–2025), the price was higher after 5, 12 and 20 trading days 54.1%, 54.3%, 56.1% of the time. After any day it was 53.9%, 55.3%, 56.8%.
How is “Hanging man” defined here?
The same shape as a hammer: the lower wick is at least twice the body, the upper wick is no more than 10% of the range or half the body (whichever is larger), the body is more than 5% of the range, and the range is at least 0.8 times the average daily range of the 14 sessions ending three days earlier. The close rose more than 2.5% over the 8 days before it. We count the day it forms.
How these numbers were made
We ran the same signal detector MarketSeekho uses to grade players over every trading day of 187 NIFTY 200 stocks, Jan 2021 to Oct 2025, using NSE end-of-day prices (1,54,833 stock-days). We counted the first day a signal appeared, then ignored the same signal on the same stock for 12 trading days so results don’t overlap. Windows with splits, bonuses or trading halts were left out.
“Any day” is the baseline: the same measure after every day in the data, signal or not. It matters because 2021–2025 was mostly a rising market, so stocks were higher after 12 days more often than not anyway. Past results don’t predict future ones, and this is not investment advice.