The Tweezer Top formation is viewed as a bearish reversal pattern seen at the top of uptrends and the Tweezer Bottom formation is viewed as a bullish reversal pattern seen at the bottom of downtrends. Sometimes Tweezer Tops or Bottoms have three candlesticks. The market opens and goes straight down, often eliminating tweezer bottom babypips forex entire gains of Day 1.
Nevertheless, Day 2 is completely opposite because prices open and go nowhere but upwards. This bullish advance on Day 2 sometimes eliminates all losses from the previous day. Day 2 opened where prices closed on Day 1 and went straight up, reversing the losses of Day 2. A potential buy signal might be given on the day after the Tweezer Bottom, if there were other confirming signals. Trading Style to earn the best ROI on your trading capital. This type of Candlestick Pattern may come in various different ways and it is very important that you need to know about them. Let’s start with the Tweezer Bottom.
This type of Candle Pattern composes of two or more candlesticks that exactly have the same matching bottoms. Tweezer Bottom can be encountered on a Downtrend which provides a high possibility of reversal signal. The Tweezer Top is the exact opposite of the above case. When the current trend of the market is up then it is most likely that you will encounter this type of Candlestick pattern especially on the near end of the move.