Tweezer

What Is a Tweezer?

A tweezer is a technical analysis pattern, commonly including two candlesticks, that can connote either a market top or bottom.

Grasping Tweezers

Tweezer patterns are reversal patterns and happen when at least two candlesticks touch a similar bottom for a tweezer bottom pattern, or when at least two candlesticks touch a similar top for a tweezer top pattern.

Tweezer bottoms are considered to be short-term bullish reversal patterns, while tweezer tops are believed to be bearish reversals. Basically, with the two developments, either purchasers or venders couldn't push the top or bottom any further. The two types of patterns require close perception and research to be deciphered and utilized accurately.

1. A bearish tweezer top happens during an uptrend when bulls push prices higher, frequently ending the day close to the highs (generally considered a strong bullish signal). Then, on the following (second) day, traders reverse their market sentiment. The market opens, doesn't breach the prior day's highs, and heads straight down, frequently dispensing with the greater part of the prior period's gains.
2. On the flip side, a bullish tweezer bottom is realized during a downtrend when bears keep on driving prices lower, closing the day close to lows (typically a strong bearish trend). Once more, Day 2 is a reversal, as prices open, don't breach the prior day's lows, and head pointedly higher. A bullish advance on Day 2 can rapidly take out losses from the previous trading day.

A tweezers top is distinguished by two candles with comparative highs happening back-to-back. A tweezers bottom would see two candles rather with comparative back-to-back lows.

Special Considerations

As an investment strategy, tweezers offer traders a level of precision while seeking to exploit market trends. While tweezers can take on different appearances, they all share several qualities practically speaking: Sometimes showing up at market-defining moments, these candlestick patterns can be utilized for analysis purposes — to just demonstrate the possibility of a reversal — or they can be utilized within a more extensive setting of market analysis to give trade signals to trend traders.

Tweezers were made mainstream in Steve Nison's well known candlestick charting book Japanese Candlestick Charting Techniques. Candlestick methods are described by the body of a candle which is made by the difference between the open and close, while the thin "shadows" on one or the flip side of the candle mark the high and low over that period. Regularly, a dark, or red, candle shows the close was below the open, while a white or green candle highlights the price closing higher than it opened.

Likewise with some other trading tool or indicator, tweezers ought to be utilized related to different indicators or market signals.

Highlights

• A tweezer is a technical analysis pattern, commonly including two candlesticks, that can mean either a market top or bottom.
• Tweezers were made mainstream in Steve Nison's famous candlestick charting book Japanese Candlestick Charting Techniques.
• Tweezer bottoms are considered to be short-term bullish reversal patterns, while tweezer tops are believed to be bearish reversals.