Spinning Candle Pattern (spinning top and bottom real chart examples)

Spinning Candle Pattern (spinning top and bottom real chart examples)
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The Spinning Candle is a candlestick chart pattern which signals a potential pause or indecision in the market. In this article we will show you how to identify it in the right market position with real chart examples.

The Spinning Candle Pattern is a candle pattern which signals indecision in the market. The Pattern can be Bullish (Spinning Bottom), Bearish (Spinning Top) or Neutral (Spinning Candle) depending on where it forms.

Bearish Spinning Top should be identified as a signal when occurring in an up-trending market or at the top of a range. Bullish Spinning Bottom should be identified as a signal when occurring in a down-trending market or at the bottom of a range. In general any Spinning Candle should be treated as indecision or pause in the market. If it happens in a range it is a Neutral Pattern just signaling that the market does not know what to do.

Spinning Candle Pattern Criteria:

  • A small real body.
  • Ideally roughly symmetrical with the real body in the middle of the range (upper and lower shadows about the same size).
  • Can be any color (red or green).

Additional Notes:

  • Similar to a Doji Candle which also represents indecision. However a Doji Candle has no real body. Learn more about Doji Candle Pattern HERE.
  • Overall a weak signal that generally represents indecision and trader should wait for further confirmation.

Quick Reference Guide – Candlestick Basics. If you need a reminder of what candlesticks are have a look at our free PDF – Candlesticks Explained.

The criteria and examples above are just the technical definitions of this pattern. However patterns are only useful with context and with real chart examples.

No pattern will ever exactly match the criteria and in order to be a useful signal must occur in the correct place in a trend. Let’s start by looking at the the classification table for this pattern.

Bullish Spinning Bottom Candle Pattern Classification Table

Number of Candles In Pattern 1
Type: (Reversal/Continuation) Reversal
Bullish/Bearish/Indecision Bullish
Market Conditions: Range, Down-trend, Up-trend Down-trend, Ranging
Position: Top, Bottom, Range Bottom

Bearish Spinning Top Candle Pattern Classification Table

Number of Candles In Pattern 1
Type: (Reversal/Continuation) Reversal
Bullish/Bearish/Indecision Bearish
Market Conditions: Range, Down-trend, Up-trend Up-trend, Ranging
Position: Top, Bottom, Range Top

Spinning Candle Pattern Classification Table

Number of Candles In Pattern 1
Type: (Reversal/Continuation) N/A
Bullish/Bearish/Indecision Indecision
Market Conditions: Range, Down-trend, Up-trend Up-trend, Down-trend, Ranging
Position: Top, Bottom, Range Top, Bottom, Range

What Price Action Do The Spinning Candle Patterns Represent?

All candlestick patterns are formed by price action. But the popular ones represent price action that may have significance in signalling the direction of the market.

The spinning candle forms when both buyers and sellers push the price during a trading range but neither gains control. When the price closes near where it opened, despite ranging both up and down in the period. A spinning candle is formed.

If this occurs after a strong trend either up or down, it can signal that the trend is running out of steam and may potentially reverse.

If the market is down-trending and a spinning candle forms then this is a Bullish Spinning Bottom. If the market is up-trending and a spinning candle forms then this is a Bearish Spinning Top.

Confirmation

As this pattern by definition represents indecision, it is always best to look for confirmation before entering the market on a potential reversal.

This confirmation can be in the form of another technical indicator or if the spinning candle forms at an area of support (Spinning Bottom) or resistance (Spinning Top).

Hint: It is always good practice to look for confirmation for any signal that you are looking to trade.

Bullish Spinning Bottom Candle Example With Confirmation

In the example below of the FTSE100, the market was down-trending and a Bullish Spinning Bottom Candle formed at the bottom of the trend.

This pattern coincided with an area of support as it formed at a round number level. This confirmation can help the trader to feel more confident in the signal and the potential for a good trade.

In this example you can see the resistance held and the market revered on strong price action and then started an up-trend.

Bullish Spinning Bottom Candle Pattern Example With Confirmation
Bullish Spinning Bottom Candle Pattern Example With Confirmation

Note: you can get a free round level indicator for MT4 from us here: Round Levels MT4 Indicator.

Bearish Spinning Top Candle Pattern Example With Confirmation

In the example below the US30 market was in an uptrend that had started with good momentum and then continued to trend up. As it neared resistance it had a strong final move after which a Bearish Spinning Top Candle formed.

This pattern coincided with an area of resistance as it formed at a round number level. This confirmation can help the trader to feel more confident in the signal and the potential for a good trade.

As can be seen in the example, the trend faltered and there was a subsequent rejection at the round number level.

Bearish Spinning Top Candle Pattern Example With Confirmation
Bearish Spinning Top Candle Pattern Example With Confirmation

In What Market Conditions Does The Spinning Candle Pattern Become A Signal?

To recap, the Bullish Spinning Candle (Spinning Bottom) can be seen as a potential signal when forming at the bottom of a down-trend or the bottom of the range. It is preferable to see a sustained down-trend prior to it forming and ideally at an area of support.

The Bearish Spinning Candle (Spinning Top) can be seen as a potential signal when forming at the top of an up-trend or the top of the range. It is preferable to see a sustained up-trend prior to it forming and ideally at an area of resistance. Let’s look at a couple of real chart examples.

Bullish Spinning Bottom Candle Pattern In A Ranging Market

A ranging market is one where the price action moves up and down between two sets of support and resistance. This is also known as a sideways, balancing or horizontal market. In essence the price action is struggling to break out of the range decisively either on the upside or downside.

Ranging Market Example
Ranging Market Example

In a ranging market the Spinning Candle can be a helpful signal to validate the top or bottom of the range. As you can see in this example of the US30 the market was ranging and a Bullish Spinning Candle occurred at the bottom of the range.

This was potential confirmation that the bottom of the range would hold and the market subsequently reversed.

Bullish Spinning Bottom Candle Pattern Example in a Ranging Market
Bullish Spinning Bottom Candle Pattern Example in a Ranging Market

Bullish Spinning Bottom Pattern In A Down-Trending Market

A down-trending market is one where the price action generally moves down over time and is characterized by lower lows and lower highs.

Down-trending Market Example
Down-trending Market Example

As you can see in this FTSE100 example, the market was down-trending and then the Bullish Spinning Bottom Candle Pattern formed at the bottom of the trend. The market reversed and went higher.

Bullish Spinning Bottom Candle Pattern Example in a Down-trending Market
Bullish Spinning Bottom Candle Pattern Example in a Down-trending Market

Bearish Spinning Top Candle Pattern In A Ranging Market

In this US500 market example the market was in a range. The market attempted to break the top of the range but a Bearish Spinning Candle Pattern formed.

In this example the Spinning Candle was a potential indicator that the range level would hold. The market failed to breakout and moved back down the range.

Bearish Spinning Top Candle Pattern Example in a Ranging Market
Bearish Spinning Top Candle Pattern Example in a Ranging Market

Bearish Spinning Top Pattern In An Up-Trending Market

An up-trending market is one where the price action generally moves up over time and is characterized by higher highs and higher lows.

Up-trending Market Example
Up-trending Market Example

In this FTSE100 market example the market was uptrending and a Bearish Spinning Top Candle Pattern formed. The uptrend then stalled and reversed.

Bearish Spinning Top Candle Pattern Example in a Up-trending Market
Bearish Spinning Top Candle Pattern Example in a Up-trending Market

Note: The example above is very similar to a Shooting Star Pattern. It is important to remember that in real markets, patterns rarely form in their perfect shapes. The important thing to learn is the skill of asking: “What does this price action represent?”.

Spinning Candle Significance

As mentioned, this is a fairly common pattern that is a weak signal and is often only significant if forming at the correct part of a trend or with confirmation.

The screenshots below show how often this pattern or candles very close to this pattern can form with little or no significance to the market trend.

Spinning Candle Pattern In An Up-Trending Market

Spinning Candle Pattern Example in a Up-trending Market

Spinning Candle Pattern In A Down-Trending Market

Spinning Candle Pattern Example in a Down-trending Market
Spinning Candle Pattern Example in a Down-trending Market

Spinning Candle Pattern In A Ranging Market

Spinning Candle Pattern Example in a Ranging Market
Spinning Candle Pattern Example in a Ranging Market

Candle Pattern MT4 Indicator Downloads

If you trade using MT4 then why not try out our free MT4 indicators? Most of our indicators, including the most common candle pattern indicators are Free and available for download here: MT4 Indicator Page.

Most of our candle indicators also have an alternate version which can show the signal in a separate indicator window of the chart if that is your preference.

For advanced users you can use our Pin Bar Pattern Manager (Paid) to specify your own parameters of candles you want to identify. You can find that here.

Important Information About Candlestick Patterns

Attribution:

All of the candlestick patterns that we explain on NothardTrading.com must be attributed to Steve Nison and his books on candle charting, the most famous of which was Japanese Candlestick Charting Techniques (Amazon). You can also find out more at his website here.

Interpretation Of Candle Patterns:

It is important to note that these patterns were originally identified on the daily timeframes of index charts, which is still where they are the most useful. However, this does not mean that they cannot be used for other markets or time frames.

No signal is perfect and should never be used as such. Any patterns that you identify only signals a potential move based on the fact that history repeats itself and forms regular patterns in similar situations.

But past performance is no guarantee of future results! So always treat these patterns with care and think of these guidelines when using them.

Best practice guide for trading of candle patterns:

  • No pattern is ever perfect. Be aware that patterns will form slightly differently each time and in different markets.
  • Use them as consistently as possible. Even though you will never find patterns exactly the same, you should always implement a consistent ruleset when identifying and using patterns.
  • It is never a guarantee, only an indication.
  • Make sure you are using it in the right context. For example if it is a continuation pattern then don’t use it to trade reversals!
  • Use multiple signals (confirmations) to have more confidence in your trading.

Related Candle Pattern Doji Candle Pattern

More About Candlestick Patterns

If you are interested in reading more about candlestick patterns you can find our articles on this topic here: https://www.nothardtrading.com/category/candle-patterns/ or choose a pattern below to read more. 

Justina Nothard

Justina Nothard

Hi, I’m Justina Nothard, a retail investor trading Stock Index Futures.

I understand how hard it can be for the ordinary trader to learn the basics and find useful tools and practical information.

This is why I decided to create Nothard Trading to help you take control of your trading.

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