Feb 2020 prints a Spinning Top Candle

spinning top

 

What is a Spinning Top Candlestick?

A spinning top is a candlestick pattern with a short real body that’s vertically centered between long upper and lower shadows. The candlestick pattern represents indecision about the future direction of the asset. Neither the buyers nor the sellers could gain the upper hand. The buyers pushed the price up during the period, and the sellers pushed the price down during the period, but ultimately the closing price ended up very close to the open. After a strong price advance or decline, spinning tops can signal a potential price reversal, if the candle that follows confirms.

A spinning top can have a close above or below the open, but the two prices need to be close together.

 

Spinning tops, and nearly all candlestick patterns, require confirmation. If a spinning top could be the start of a reversal, the next candle should confirm. If the spinning top is showing indecision, then the next candle should also move sideways within the range.

Sometimes spinning tops may signal a significant trend change. A spinning top that occurs at the top of an uptrend could be a sign that bulls are losing their control and the trend may reverse. Similarly, a spinning top at the bottom of a downtrend could signal that bears are losing control and bulls may take the reins.