Tweezer Top
Tue, Apr 15A Tweezer Top is a bearish reversal pattern that appears at the peak of uptrends, consisting of two Japanese candlesticks with identical tops. These matching tops are typically formed by shadows (or wicks), but they can also be the bodies of the candles.
This pattern occurs during an uptrend when buyers drive prices higher, often closing the session near the highs, but fail to push the price above that peak. Tweezer Tops are regarded as short-term bearish reversal patterns that indicate a potential market top.
To identify a Tweezer Top, look for the following criteria:
- There must be two or more consecutive candles of either color.
- A clear uptrend should be present.
- Both candles must reach the same high point.
Once you have established an uptrend, simply search for candles that have the same highs. While the color and shape of the candle bodies should not be completely disregarded, they are not the primary focus.
The upper shadows of the two candles indicate a resistance level. The bulls were unwilling to buy above that highest price, allowing the bears to regain control and push the price downward. The formation of two or more candles with shadows at this level confirms the strength of the resistance, suggesting that the uptrend has likely stalled or, worse, reversed into a downtrend.
Similar to the Tweezer Bottom, the Tweezer Top is recognized as a reversal pattern. To analyze a specific Tweezer Top more effectively, consider the following:
- If the Tweezer Top appears at market highs, it is more reliable.
- If the first candle has a large body and the second has a short body, the reversal is more trustworthy.
- If the Tweezer Top is followed by another reversal pattern, such as a Bearish Engulfing or Dark Cloud Cover, with identical highs, it is even more reliable.
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