Correct me if I am wrong but I thought that tweezer bottom
(or top) is in reference to the appearance of a two bar (OHLC)
pattern on a bar chart. The tweezer is formed by a large down day
with prices opening and then trending down to close at the low, to
be followed by the opposite, an open at the lows with prices
trending upwards to close at the high. On a candlestick chart this
would look like a large red candle followed by an equally large
green candle. This indicates that selling has found a floor and
could be a turning point.
Yesterday's candle indicated to me that prices tried to go up
but could not break the first resistance at 1296 area and sold off,
so bearish for now. It is an inside day however, so a potential
long trade on a break of the high (and short on a break of the
low).
Vida - here is an illustration of the pattern. This is a
'weak' reversal pattern and like most such patterns would need
confirmation. Picking bottoms or tops is not advisable. One must
respect the prevailing trend until evidence is sufficient to
indicate a change of direction. With that said, the market is
certainly getting more compressed on the downside so be prudent
with such trades.
Steve, thanks for the link. This must be the pattern that
Hurricane Malta was referring to. I got rid of the psychological
impulse to pick tops and bottoms without valid trade set ups a
quite a while ago and my account is alot happier for that!
Vida, I may be wrong, but I'm with you. Also what you discribe
as a Tweezer bottom is also what I call a Railroad Track to
nowhere. Which I have not yet seen on the SPX chart. Yesterday
would have been bullish if we had closed at or near the highs but
instead we closed at the lows.
http://screencast.com/t/PpNTX1chgM
Correct me if I am
hammer
Posted by Vida on 8th of Jun 2011 at 09:07 am
Correct me if I am wrong but I thought that tweezer bottom (or top) is in reference to the appearance of a two bar (OHLC) pattern on a bar chart. The tweezer is formed by a large down day with prices opening and then trending down to close at the low, to be followed by the opposite, an open at the lows with prices trending upwards to close at the high. On a candlestick chart this would look like a large red candle followed by an equally large green candle. This indicates that selling has found a floor and could be a turning point.
Yesterday's candle indicated to me that prices tried to go up but could not break the first resistance at 1296 area and sold off, so bearish for now. It is an inside day however, so a potential long trade on a break of the high (and short on a break of the low).
Reply
Posted by steve on 8th of Jun 2011 at 09:20 am
Vida - here is an illustration of the pattern. This is a 'weak' reversal pattern and like most such patterns would need confirmation. Picking bottoms or tops is not advisable. One must respect the prevailing trend until evidence is sufficient to indicate a change of direction. With that said, the market is certainly getting more compressed on the downside so be prudent with such trades.
http://www.fxwords.com/b/bullish-tweezers-bottom-candlestick.html
Steve, thanks for the link.
Posted by Vida on 8th of Jun 2011 at 09:48 am
Steve, thanks for the link. This must be the pattern that Hurricane Malta was referring to. I got rid of the psychological impulse to pick tops and bottoms without valid trade set ups a quite a while ago and my account is alot happier for that!
Vida, I may be wrong,
Posted by ditch on 8th of Jun 2011 at 09:17 am
Vida, I may be wrong, but I'm with you. Also what you discribe as a Tweezer bottom is also what I call a Railroad Track to nowhere. Which I have not yet seen on the SPX chart. Yesterday would have been bullish if we had closed at or near the highs but instead we closed at the lows. http://screencast.com/t/PpNTX1chgM
Ditch, the YES on your
Posted by Vida on 8th of Jun 2011 at 09:51 am
Ditch, the YES on your chart is exactly what I meant! Thanks for posting it.
you are welcome. It's really
Posted by ditch on 8th of Jun 2011 at 09:58 am
you are welcome. It's really a simple chart tool that shows price rejection and often marks swing lows or highs.