Polished Hematite has been always used as magical mirror (similar to obsidian ),so it can be used for scrying and for reflecting back the negativity .
It can be used for divination purposes .
This stone is used for making amulets .
Because of its red internal color it is employed into healing of blood related disorders and problems .It is also believed that hematite, previously emerged in cold water , pressed against bleeding minor wound will stop the bleeding .(This will not work in case of severed artery or vein !Seek medical help as soon as possible. )
Roman soldiers used to rub their bodies with the red powder that came from it ,to make them invincible .
When used in divination ,its appearance in readings tells you: to avoid felling into old traps by starting fresh .
Healing uses .
According Cassandra Eason it is one of the best stones for self-healing .If you keep it against painful place or against solar plexus chakra (in case of energetically related issue ), will draw out ,pain ,illness and muscle weakness .This property of his makes it excellent stone for empaths and overly sensitive psychics .Hematite , also calms down racing pulse,when combined with some breathing techniques .
In magic it can be used in all legal wrangels and matters of injustice .Hemetite often is used to banish fear and can help you to avoid becoming too emotionally involved with the problems of others .
This is very typical for most healers ,empaths and any other kind of sensitive people .
It is perfect grounding stone and is often used as psychic defence(AmE -defense) and protection .
In order to recharge it, Cassandra advises, its smudging with white sage(Salvia Apiana) or cedar .
Most authors relate Hematite with planet Mars and element of Fire .Related chakras are root (base) chakra and solar plexus chakra .
I personally use this stone against headaches and grounding ,and not so often for protection .
References :The illustrated directory of healing crystals by Cassandra Eason .My own experience .