As far as I know, to prevent water hammer, expansion loop should be in horizontal plane. If it's impossible to provide horizontal loop, 3D loop (up-horizontal-down) should be provided.

My question, what if I provide 3D loop as down-horizontal-up? Any problem with water hammer?

I think you risk trapping liquid in the loop which will firstly, add to your hammer problem, and secondly, will be difficult to drain out due to pipe movement around the loop.

I agree with MoverZ, but would like to add the following:

Assuming you're talking about a steam line (hence "water" hammer), you run the risk of slugs regardless of the layout once you go vertical.

You can reduce this problem with steam traps (which should be called water traps), but they might want to replace the first elbow of your loop with a tee, which could make your life harder. Adding the dip or low point is itself the trap.

If your fluid isn't steam, then consideration of whether or not liquids can drop out or vapors flash out are an actual risk factor applies.

I can image a long bullet which is formed inside the loop if it's going down.

Put steam traps at up-turning locations.

Without the steam trap, it doesn't matter very much if a 3D loop turns up or down. A slug could develop on the loop if the loop turns down. A slug could develop on the main run if the loop turns up.

An up-turning 3D loop is much more typical in my experience. A down-turning loop may stand out as odd to people walking through the plant.