The Inverted Hammer is a candlestick pattern used in technical analysis to indicate a potential reversal in a downtrend. It appears at the bottom of a downtrend and is characterized by a small body at the bottom and a long upper shadow. This formation suggests that buyers attempted to push the price higher but were met with selling pressure, indicating a possible shift in market sentiment. Traders often look for confirmation of the Inverted Hammer pattern through subsequent price action, such as a bullish candle following the pattern. It is important to consider other indicators and market conditions, as the Inverted Hammer alone does not guarantee a reversal.