Hammer time.

Hey everybody, I've been studying price action like a madman lately but i jsut have a quick question. For a hammer or inverted hammer bar, why are those considered reversals? Don't they show domination by one or the other, the bulls or the bears? Or is it because after those bars, the consensus starts to fade off? Thanx for any help on this.

The 'tail' on the hammer reflects either buyers or sellers coming in and turning the market decisively up or down. There's often follow-thru for at least a few subsequent candles.

I only look at hammers that are at extreems. They seem to be one of the best ways in predicting tops/bottoms. After a run up in price the bulls make an atempt for new highs but fail which results in a close much lower than the achived high. Idealy the close will be bellow prior candles close/open. The hammer reveals some or all of the folowing about the market:
The market has reached a S/R;
Some of the bulls(in an uptrend) are starting to take their profits;
Price finds a lot of selling presure(uptrend) and fails to hold the new highs which in turn migh provoke even more profit taking;
HTH

Great, thanks a lot!

Pesonally, I consider true Hammers to be an Indication of "Overshooting the Intended Target." ..."Ooops, to far, retreat."
I also believe that Hammers are more prevelant recently since the inception of E-RookieTrader not understanding where the Intended Target actually was located. {Noise}
Traders in the 'Know' pushing the price to 'x' and Taggers pushing it to 'x +/- y'
Consequently, I wait for a confirming Candle.
After All, what's 15 min or 4 hours of my life compared to riches?