Tweezer Bottom Strategy

The Tweezer Bottom is a two-candle reversal pattern that appears after a decline. Both candles share a similar low, signaling that sellers failed to push beyond that level.

Testing indicates an average annual return of about 184%. It performs best in the crypto market.

This strategy goes long after the second candle confirms the shared bottom, anticipating a bounce as selling pressure dries up.

Stops are placed just beneath the common low to manage risk, and the position exits if price fails to rally.

Details

• Entry Criteria: pattern match
• Long/Short: Both
• Exit Criteria: stop-loss or opposite signal
• Stops: Yes, percent based
• Default Values:
  • CandleType = 15 minute
  • StopLoss = 2%
• Filters:
  • Category: Pattern
  • Direction: Both
  • Indicators: Candlestick
  • Stops: Yes
  • Complexity: Intermediate
  • Timeframe: Intraday
  • Seasonality: No
  • Neural networks: No
  • Divergence: No
  • Risk level: Medium