A candlestick pattern known as a spinning top features a short true body vertically positioned in the middle of extended upper and lower shadows. The candlestick pattern signifies uncertainty over the asset’s future course. In other words, neither buyers nor sellers could prevail.
When buyers and sellers push the price up and down for a predetermined time, the closing price ends up being extremely near to the open; a candlestick pattern is formed. Spinning tops can indicate a potential price reversal after a significant price increase or decrease if the next candle confirms. The close and open prices on a spinning top are never far apart, regardless of whether the close is above or below the open.

Spinning Top Candlestick in a nutshell
- A spinning top candlestick displays a short body between long upper and lower shadows, indicating uncertainty in market direction.
- The pattern suggests neither buyers nor sellers are dominant, resulting in minimal price difference between open and close.
- They may indicate a shift in trend direction, such as a weakening uptrend or potential reversal in a downtrend.
What do Spinning Top Candlesticks hint?
Spinning tops hint that the asset is indecisive, and the absence of a significant price shift between the open and close is shown by the length of the upper and lower shadows. In the end, the price closed close, to where it opened despite the bulls and bears sending it sharply higher and down, respectively. This uncertainty may indicate more sideways movement, particularly if the spinning top is inside a predetermined range. It might mean a potential price reversal if it happens after a price increase or decrease.
Spinning tops can occasionally indicate a substantial shift in the trend. An uptrend’s spinning top could indicate that bulls are losing the upper hand and that the trend may be about to change.
Illustration: What do Spinning Top Candlesticks look like?
Spinning Top Candlesticks look like candles with small real bodies and long upper and lower shadows, indicating market indecision. The leftmost one, the first one, comes after a brief price decline. A downward candle follows it, signaling a continued decline in price. The price did begin to move a little downward before turning upward. This emphasizes the significance of having a strategy and risk management after the candlestick when making trades based on candlesticks.
Within a certain range, the second spinning top happens. As the price moves sideways, it confirms the market’s current hesitation.
The candles around the third spinning top are very small compared to it. It came after an advance, and a big down candle came after it. Given that the price continued to decline, this turned out to be a reversal candle.
Another spinning top appeared as the price began to decline. It turns out to be a momentary halt because the following candle gapped lower and plummeted.
The examples emphasize the value of context and confirmation. Spinning tops within ranges frequently validate the range and the market’s ambiguity. Trend-specific spinning tops may be reversal indications, but the candle that comes next must confirm.
How to trade the Spinning Top with Binary Options?
To trade the spinning top with binary options, firstly, identify the spinning top in a binary options chart. It’s a candlestick with a small body and long upper and lower shadows, indicating indecision between buyers and sellers. Spinning tops occur in the middle of an uptrend or downtrend, signalling a possible market reversal or consolidation.
- In an uptrend, a spinning top formed at resistance levels could signal a reversal and prompt traders to consider put options.
- In a downtrend, a spinning top near support levels could signal a potential reversal, prompting traders to consider call options.
Example: How to reduce false signals?
To reduce the risk of false signals, it is important to exercise caution and confirm signals with additional technical indicators. Use tools such as support and resistance levels, trend lines and oscillators to minimize the risk of false signals.
The NASDAQ 100 binary options chart above displays a Spinning Top candle (bearish) at the uptrend’s peak, marked by the green trend line. This indicates uncertainty among buyers and sellers, suggesting a possible trend reversal.
What does the Spinning Top indicate?
The spinning top candlestick pattern indicates hesitation and that additional sideways movement may occur, given that both buyers and sellers attempted to push the price but were unsuccessful.