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An indecision pattern with a small body and roughly equal upper and lower shadows, signaling that neither buyers nor sellers have control.
The Spinning Top is a single-candle indecision pattern characterized by a small real body positioned in the middle of the candle's range, with upper and lower shadows of roughly equal length. Unlike a Doji where open equals close, the Spinning Top has a small but visible body.
The pattern gets its name from its resemblance to a child's spinning top toy - balanced in the center with extensions in both directions. The small body shows that neither buyers nor sellers gained decisive control during the session.
The Spinning Top tells a story of market uncertainty. During the session, both buyers and sellers had their moments of control - price moved significantly higher AND significantly lower - but by the close, neither side had won decisively.
The equal shadows show that buying and selling pressure were balanced. The small body in the center represents the net result of this tug-of-war: essentially a draw. The market is unsure of its next direction.
When this appears after a strong trend, it's significant. A trend requires conviction; indecision suggests that conviction is fading. The Spinning Top is often an early warning that the current trend may be losing steam - though confirmation is needed to act on this signal.
Wait for confirmation. The Spinning Top alone is not a trade signal - it's an early warning. Enter only when the next candle confirms direction by breaking the high (bullish) or low (bearish).
Place stop beyond the opposite extreme of the Spinning Top. If going long, stop below the low; if going short, stop above the high.
T1: Previous swing point in the direction of the new trend. T2: Key support/resistance level that acted previously.
Minimum 1:2 R:R required. Due to the wide range of Spinning Tops, ensure target justifies the stop distance.
A Spinning Top's significance depends entirely on context. In a sideways market, it's just noise. After a strong trend at a key level, it can be an early warning of reversal.
Multiple spinning tops in a row signal a market that's lost direction. Wait for a decisive candle before taking any position.
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