Tweezer tops & Hammer Candlesticks

SW.....

The main problem here is the fact that those aren't tweezers. Tweezers form at the top or bottom of a move.
 
Quote from swtrader:

'Beyond the tweezer level with a specific number needs to be defined. '

what I mean, would be a stop just above the highs of the 2 candles that compose the tweezer top

(and inverse for tweezer bottoms)
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Ok...now that we are on the same page.

Although those are not tweezer tops...

I understand what your talking about via tweezers and stop placement (trade management).

However, its rare to find tweezers in QQQQ (formerly QQQ), SPY, DIA and on some Index charts...unless you bend the rules a little.

Thus, traders that use them on those charts tend to bend the rules a little.

Whereas with me...almost or close enough doesn't count.

Simply, a tweezer top must have equal highs or a tweezer bottom must have equal lows.

Also, the only tweezer tops that catch my eye are the ones that occurs in a bigger price action called Lower High...

Whereas I have too much difficulty in trading tweezer tops that occurs as part of a price high (95% of the time I avoid these...the times I don't...I'm just stupid).

Therefore, reality is that the price action in your charts reminds you of something that has a name (tweezers) or something very familiar that you've seen before.

With that said...what are the commonalities of the price action in your charts...

* Lower Price Highs
* Wide Range Body
* Long Shadow

I always do 60min or 120min chart analysis as my trade management of any trade signals I get via the daily chart...this also allowed me to clearly see the Lower Price High price action because your Jan 2004 daily chart didn't have a valid Lower High although there was clearly something there via the white line that behaved as a wide range body.

Regardless if the trade signal occurred on a daily, weekly or monthly chart...I think we as traders need to drop down to a lower chart interval to get a better grip on the trade management...

Especially when we are confused about trade management.

Now back to them Lower Highs.

Lower Highs are what I sometimes call failed counter-thrusts (failure to make a higher high).

My methodology (different from yours)...

Stop placement (trade management) needs to be based upon the price action that occured between the lower highs and my risk level (what I can tolerate losing on a single trade).

Now I'm going to discuss one of your charts (Jan 2005) more in-depth via 60min price action analysis.

I would have placed my stop at 39.00 based on the price action trade signal in reference to close of the red candlestick (2nd candlestick @ 38.08) in what you thought was a tweezer top on that daily chart.

That initial stop is based upon a 60min WRB I saw back on Jan 4th that closed its interval @ 2:30pm est...

An initial stop not based upon the close of the 60min red WRB but upon where I felt was a key area of shift in supply/demand within the WRB (this is another story I won't discuss in this thread).

Now...if that's too wide of a stop (beyond my risk level)...I can either ignore the trade signal or I'll reduce my position size to get back within a tolerable risk level.

Summary or Hints:

* Understand the overall price action to help with trade managment (stuff after entry).
* Tweezer Tops at price highs behave differently than tweezer tops as confirmation to a lower high.
* Wide range bodies or long shadows can help find that specific number for initial stop/loss placement...these areas often represent key shifts in supply/demand or s/r levels.
* If the stop is too large for your risk level...either lower your position size although this will also lower your reward potential or don't take the trade.

My point with all the above...understand the price action prior to trying to interpret Japanese Candlesticks.

Then you earn the right to call it whatever you want...tweezer top or sushi mama. :cool:

NihabaAshi
 
Zere iss a cure vor ze phantazy of ze tveezer topp. It iss to test it. Ziss vill teach you to moof on to anozer phantazy. I meinself do not like ze tradink phantazies. I prefer ze zexual.
 
I must agree with my esteemed colleague. It is most peculiar, but those afflicted with "Tweezer Top Syndrome" see only tweezers at tops, whereas tweezers occur everywhere. The benefit of backtesting is to return those so unfortunately afflicted to reality. One wonders, were tweezers applied to their tops at birth during that monstrously barbaric practice of circumcision? Is that the source of the obsession?
 
Are you asserting that traders with foreskins are better market analysts? If so that would be an ET first! Maybe Appalachian white trash does have an advantage over city slickers! As my pappy allus sayed, "I was never circumsized, but I can skin it way back!"
 
Quote from swtrader:

I know there was a thread a while back 'trading hammers'

Particularly on daily charts, where I think the high or a low of a candle is more signifigant

also, I ask about hammer bottoms/gravestone dogi tops, with appropriate stops as well - particularly when there is volume

I have been focussed on moving averages for a while, and it seems like they can be so 'fuzzy' in terms of what might be expected vs how they can actually play out, while meanwhile it seems like the actual market concensus gets played out in these particular candles
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[+]

Swtrader;

Not sure of what you mean by fuzzy on moving averages.


And as far as hammer bottoms or ,
dogi [+] tops;
would want to measure a trend with more that that.:cool:

Good place to start measuring.
 
Basically, sw trader, you need to do your own testing, like go thru 300 pages of printed out charts. I'm serious, that's what Niahab a recommends actually. I don't believe someone here will say o yea this pattern XYZ, it provides this W/L and this win % and occurs this often.
 
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