Hammer with Absorption

Hammer with Absorption is an indicator for ATAS footprint charts. It highlights "hammer" and "inverted hammer" candles only if their long wick features a sequence of diagonal bid/ask absorption within the footprint. The indicator extends the price absorption range to the right as a visual zone until price retests it. Candle shape alone is insufficient for a marker; absorption within the wick is strictly required.

How the Indicator Works

1. Candle Shape Verification

• Bullish Hammer: the lower wick is at least the Wick-to-Body Ratio multiplied by the body size, while the upper wick does not exceed Max Opposite Wick.

• Bearish Inverted Hammer: mirror validation based on the upper wick.

2. Absorption Check in the Wick

   If the shape is valid, the indicator inspects the footprint of that wick level by level. At each level, bid is compared against the ask of the adjacent level (diagonal pair) and a signed imbalance is calculated. A level qualifies as absorption if the imbalance meets or exceeds the Absorption Threshold against the aggressor:

• in the lower wick — absorption of aggressive selling by limit bids

• in the upper wick — absorption of aggressive buying by limit asks

  There must be at least Consecutive Levels of such absorption consecutively, preventing a single random imbalance from triggering a marker.

3. POC Filter

   When enabled, absorption levels must reside at or beyond the candle's POC: below the POC for bullish signals, and above the POC for bearish signals.

4. Marker and Zone

   If both checks pass, the indicator plots a directional arrow and saves the absorption range as a zone. The zone extends to the right until the price range of a subsequent candle enters it.

Key Features

• Two-step logic: candle shape validation followed by absorption detection within the same wick

• Diagonal absorption analysis with configurable imbalance thresholds and consecutive level counts

• Three POC filter modes: None, At POC Only, or Beyond POC

• Zones anchored to footprint cluster cells

• Directional arrows with customizable colors, sizes, and offsets

Settings

• Wick to Body Ratio & Max Opposite Wick to Body Ratio: minimum wick-to-body ratio and maximum allowable opposite wick

• Absorption Threshold (%): higher values demand stronger absorption

• Consecutive Absorption Levels: number of consecutive absorption levels required

• POC Filter Mode: None, At POC Only, or Beyond POC

• Allow Zero Bid/Ask Compares: whether to include comparisons involving zero bid or ask

• Show Extension Zones: toggle zone display

• Display Options: arrow tick offset, arrow size, arrow and zone colors for bullish and bearish markers

• Max Bars to Calculate: calculation depth (0 = entire chart)

Use Case Examples

• ES, 2,000-contract footprint: Price drops toward the previous day's low and forms a candle with a long lower wick and a small body. Inside the wick, the indicator detects three consecutive levels where limit bids absorbed aggressive selling above the threshold. A green arrow appears beneath the low, and the absorption range extends to the right as a bullish zone. Traders evaluate how price behaves upon retesting this zone.

• NQ: Price pushes sharply into the session high and forms an inverted hammer, showing a series of ask-absorption of buying within its upper wick. A red arrow appears above the high, and the bearish zone extends until a subsequent candle enters it.

The author recommends viewing these markers near swing highs/lows, prior session levels, and value area boundaries as an additional factor in personal analysis.

Requirements

Requires footprint (cluster) data. Not suitable for spot Forex.

Pricing

$59.90 — one-time purchase.