Tweezer Tops & Bottoms Strategy

BySachin Kotecha

The Tweezer Tops and Bottoms strategy is a powerful price action technique used by traders to identify potential market reversals at key levels. These double-candle formations signal a strong rejection of price and often appear at the peak or trough of a trend. When used with technical confluence and proper confirmation, Tweezer patterns can offer excellent risk-to-reward setups in both intraday and swing trading.

This guide breaks down how to identify, confirm, and trade the Tweezer Tops and Bottoms strategy across all major markets.

What Are Tweezer Tops and Bottoms?

Tweezer Tops:

Appear at the end of an uptrend
Two consecutive candles with similar highs
First candle: Bullish
Second candle: Bearish, often larger or equal in size
Indicates rejection of higher prices

Tweezer Bottoms:

Appear at the end of a downtrend
Two consecutive candles with similar lows
First candle: Bearish
Second candle: Bullish, signalling buying interest
Indicates rejection of lower prices

The most reliable setups occur when the highs or lows match to the pip or nearly so, especially on 4H or daily timeframes.

Why This Strategy Works

Tweezer patterns are strong reversal signals because they represent back-to-back tests of a key level, where price is unable to push further. The presence of opposing candles confirms a shift in market control—from bulls to bears (Tops) or bears to bulls (Bottoms).

Used in the right market context, they offer:

Low-risk entries with tight stop-losses
Clear invalidation levels
High potential for directional moves

How to Trade the Tweezer Tops & Bottoms Strategy

A disciplined approach is key to success with this pattern. Here’s a step-by-step strategy:

1. Identify Valid Tweezer Formations

Structure: Two candles with near-identical highs (Tops) or lows (Bottoms)
Trend: Must appear after a clear upward (Tops) or downward (Bottoms) trend
Candle Shape:
- First candle: Continuation in direction of the trend
- Second candle: Reversal in direction, ideally engulfing or strong

Tip: The more symmetrical and balanced the pattern, the stronger the reversal signal.

2. Confirm with Key Technical Levels

Tweezer patterns are most effective when they occur at:

Resistance (Tops) or Support (Bottoms)
Round numbers or psychological price zones
Fibonacci retracement zones (38.2%, 61.8%)
Trendline touches
Previous swing highs/lows

Example: A Tweezer Bottom on GBP/USD at the 61.8% retracement of the last upward leg adds high confluence.

3. Wait for Confirmation

Avoid trading the pattern alone. Wait for a third confirmation candle:

Tops: Bearish candle breaking below the pattern low
Bottoms: Bullish candle breaking above the pattern high

Entry Options:

Breakout Entry: Enter on break of the second candle’s high (Bottoms) or low (Tops)
Pullback Entry: Wait for a retest into the pattern’s range and enter on rejection

4. Stop-Loss and Take-Profit Planning

Stop-Loss:

Tops: Above the tweezer highs
Bottoms: Below the tweezer lows

Take-Profit Targets:

Nearest support/resistance
Swing highs/lows
Fibonacci extensions (127.2%, 161.8%)
Maintain at least a 2:1 risk-to-reward ratio

5. Use Indicators to Strengthen Setups

Add confluence with:

RSI divergence: Reversal is more likely if price forms a tweezer but RSI does not confirm the trend
MACD crossovers: Help confirm shifts in momentum
Volume spike: Indicates stronger conviction behind the reversal

6. Best Markets and Timeframes

Timeframes:

1H, 4H, Daily for reliable structure
Weekly for longer-term setups

Markets:

Forex pairs (especially majors)
Gold and silver
Indices (S&P 500, DAX, FTSE)
Cryptocurrencies