Tweezer top and tweezer bottom

A tweezer is a pair of candles with matching extremes. The name comes from Japanese candlestick charting: the two wicks or bodies ending at the same price look like the two prongs of a pair of tweezers. Steve Nison defines tweezers as two or more candles with matching highs or matching lows.

The shape of each candle is secondary. The pair can be two long candles, a long one and a small one, or include a doji. What defines the pattern is the shared level and the trend before it.

A tweezer top appears after an advance. The first candle is usually a rising one that makes a new high. The second candle goes back to that high, cannot get through and closes lower. Two attempts at the same price failed, and the second failure came from sellers who were ready at that level.

It is read as bearish. The reading is stronger when the second candle is a falling candle that closes deep inside the body of the first, and when the matched high is at a known resistance level.

A tweezer bottom appears after a decline. The first candle is usually a falling one that makes a new low. The second candle tests that low again, holds it and closes higher. Buyers defended the same price twice.

It is read as bullish. The reading is stronger when the second candle is a rising candle that closes deep inside the body of the first, and when the matched low is at a known support level.

• Prior trend – an advance before a tweezer top, a decline before a tweezer bottom.
• Two neighbouring candles with the same high (top) or the same low (bottom).
• The match does not have to be exact to the tick. A difference that is small against the size of the candles is accepted.
• The classic pair has opposite colors: rising then falling at a top, falling then rising at a bottom.
• The matching extremes can be wicks, bodies or one of each.
• Time frame – tweezers on daily and weekly charts are given more weight than on intraday charts, where equal highs and lows are common.

On Charts you can mark the matched level with a horizontal line or a rectangle and check in Replay mode how price reacted when it came back to it.

• Confirmation – the pattern is complete when the second candle closes. Many traders also wait for the next candle to close in the new direction.
• Entry at a tweezer top – a short on a break below the low of the second candle.
• Entry at a tweezer bottom – a long on a break above the high of the second candle.
• Stop – just beyond the matched level: above the equal highs of a top, below the equal lows of a bottom. The stop is close, which is the main advantage of the pattern.
• Target – the nearest support or resistance in the direction of the trade, or a fixed multiple of the risk.
• Filter – an overbought or oversold RSI and a level drawn in advance add weight.

A tweezer often overlaps with another pattern, and the overlap is read as a stronger signal. A tweezer top whose second candle engulfs the first is also a bearish engulfing. A tweezer bottom whose second candle is a hammer combines two bullish readings at the same low.

Equal highs and equal lows have a second reading in Smart Money Concepts: stops collect just beyond them, and price often runs through the level before it turns. That is a liquidity sweep, and it is the usual way a tweezer fails.

• Trading tweezers inside a range – without a trend before them two equal highs or lows reverse nothing.
• Treating the pattern as a major reversal signal – on its own it is a minor one and often leads only to a pullback.
• Entering before the second candle closes – the second high or low is known only at the close.
• Placing the stop exactly on the matched level – a small run through equal highs or lows is common.
• Using it on very low time frames without a level – there equal extremes appear by chance all the time.