Tweezer Bottom
Tue, Apr 15A Tweezer Bottom is a bullish reversal pattern that appears at the end of downtrends. It consists of two Japanese candlesticks that have matching low points. These matching lows can be formed by the shadows (or wicks) of the candles, but they may also be represented by the bodies of the candles.
This pattern occurs during a downtrend when sellers drive prices lower, often closing the session near the lows, but they fail to push the price down any further. Tweezer Bottoms are recognized as short-term bullish reversal patterns that indicate a potential market bottom.
Recognition Criteria
To identify a Tweezer Bottom, look for the following criteria:
- There should be two or more consecutive candles of either color.
- A clear downtrend must be present.
- Both candles need to reach the same low point.
Once a downtrend is established, simply search for candles that have the same lows. While the color and shape of the candle bodies should not be completely disregarded, they are not the primary focus.
Meaning
The lower shadows of the two candles indicate a support level. The bears were unwilling to sell below this lowest price, allowing the bulls to regain control and push the price upward. The presence of two or more candles with shadows at the same level reinforces the strength of the support and suggests that the downtrend has likely paused or even reversed into an uptrend.
Similar to the Tweezer Top, the Tweezer Bottom is regarded as a reversal pattern. To analyze a specific Tweezer Bottom more effectively, consider the following:
- If the Tweezer Bottom forms at market lows, it is more reliable.
- If the first candle has a large body and the second has a small body, the reversal is more trustworthy.
- If the Tweezer Bottom is followed by another reversal pattern, such as a Bullish Engulfing or Piercing Line pattern, with identical lows, it is even more reliable.
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