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.

Gold hits $1650

I had the position that gold might continue through to $1650 and overnight we did. BUT this has been a sudden rise in only 6 trading days. Coronavirus? I’ve seen these rises reverse just as fast so be aware.

18 Feb 2020 Gold hits $1600USD overnight

Gold $1600   A 60% rise since Dec 2015 is very impressive in anyone’s book. Jim Rickard’s has always stated that if the price can hold over 1580 the institutional money would enter the trade. Let’s see. This is not the time to place a trade or become fixed to an event. There is a time to trade and that was in the past and will be again in the future when we can see direction of the price.

Powell Speaks

Well that was a massive week. We basically traded down until Fed Chair spoke then exploded on Thursday morning with Gold to rise $20 in two days only. Tricky to trade but we did see two dojo’s printed on the 30m chart before the liftoff so there’s a tip to remember. There was only one way to trade the $20 rise. I’ll put it in my Patreon page as a video for you. A pattern like this only has a few points so it’s vital to learn about it. If you don’t you’ll lose money fast. RB