A The Tweezer Top is a bearish reversal pattern that occurs at the top of an uptrend and consists of two Japanese candlesticks with matching tops.
The matching top usually consists of the shadow (or wick), but can also be the body of the candle.
Tweezer tops occur in an uptrend when buyers push the price higher, often ending the trade near the high, but are unable to push the top further.
The tweezer top is considered a short-term bearish reversal pattern and marks a market top.
To identify tweezer tops, check out the following criteria:
- must have two or more consecutive candles , of any color.
- There should be a clear uptrend.
- Both candles must reach the same high.
Once an uptrend occurs, just look for candles with the same high.
While you shouldn’t completely ignore the body color and shape of your candle, these factors aren’t that important.
The upper shadow of the two candles represents the resistance area .
The bulls were unwilling to buy above the top price, so the bears came back and overwhelmed the bulls, pushing the price back down.
As two or more candles form shadows at the same level, it confirms the strength of the resistance and indicates that the uptrend may have been paused or worse, has reversed into a downtrend.
Like tweezer bottoms, tweezer tops are also considered reversal patterns.
In order to better analyze a specific tweezer top, please observe the following:
- It is more reliable if the tweezer top occurs at a market high.
- A reversal is more reliable if the real body of the first candle is larger and the real body of the second candle is shorter.
- A tweezer top is more reliable if it is followed by another reversal pattern such as a bearish engulfing or dark cloud cover with the same high.