The Spinning Top candlestick pattern is a single candlestick pattern with small real bodies and 2 long shadows. The spinning top candlestick pattern shows the signals of buyers and sellers, with no one really in control of price action during candle formation.

That is also the reason why the spinning top candle opened and closed in close proximity. The small real body represents the indecision of the current market. However, we will see spinning top candles with a large range of candles. This candle will show that both buyers and sellers are very active at the moment, but the buyers and sellers are both strong, so we won't really know which side the market is leaning on. Therefore, the force of buying and selling force is strong, but in fact, the price does not create a specific direction.

The spinning top candle is mainly used in technical analysis as a signal that the trend is coming to an end. If the spinning top candle develops after a trend or a bullish or bearish trend, it could be a signal of a potential reversal. This candle shows market indecision and also shows that the market is losing momentum. The picture below shows a depiction of a spinning top candle:


When the spinning top occurs in an uptrend or upward price action, it can indicate that buyers are losing momentum and the market is now likely to make a short-term top. When the spinning top occurs in a downtrend or in downward price action, it may indicate that sellers are losing momentum and the market may experience a short-term bottom.

We should note the important features of the spinning top candlestick pattern for use in identifying and trading this candlestick pattern, including:
  • Spinning top candles are relatively symmetrical with the upper and lower tails of equal or equal size. tends to be nearly symmetrical, with the upper and lower wicks of equal or equal size.
  • Candle body must be smaller than a shadow.
  • The pattern shows market indecision and a high probability of a reversal of the current trend or at least the beginning of sideways price action.
  • This candle shows that the buyers lose confidence in either pushing prices higher or sellers pushing prices down.
  • Many traders wait for another candle after the spinning top candle has formed for further confirmation of a reversal signal.
  • The real body of a spinning top candle can be either a bullish or a bearish candle. In fact, the real body does not affect the signals that the spinning top candle provides.
Technically, the candlestick pattern acts as a signal provider to traders, it shows that one possibility will appear higher than another. However, the chance of failure will still be high. So for stop-loss candles, proper risk management is always the important thing that traders need to keep in trading.

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