Written and copyright © 2008-2013 by Thomas N. Bulkowski. All rights reserved.
In my book,
Encyclopedia of Candlestick Charts, pictured on the right,
I explore the entire range of candlestick patterns from abandoned babies to windows (not exactly A to Z, but you get the idea), in both bull and bear markets, using almost 5 million candle lines
in the tests.
The book takes an in-depth look at 103 candlestick patterns and reports on behavior and rank (3 types: reversal rate, frequency, and overall performance), identification guidelines,
performance statistics (tables of general statistics, height, and volume), trading tactics (tables of statistics on reversal rates and performance indicators),
and wraps each chapter with a sample trade. I share a sliver of that information below. If you like what you read here, then you will love the book. Help support this website and buy a copy
by clicking on the above link.
The white spinning top acts randomly. Thus, you cannot tell ahead of time which way price will breakout. Its frequency ranks second only to the black spinning top and that means it is
as prolific as bugs in your garden. Overall performance ranks a distant 69, where 1 is best out of 103 candlestick patterns. Once price breaks out (a close above the top or below the bottom
of the spinning top) it does not trend far before reversing. I really do not see any benefit to this candle.
White Spinning Top: Important Results
Theoretical performance: Indecision
Tested performance: Reversal 50% of the time
Frequency rank: 2
Overall performance rank: 69
Best percentage meeting price target: 83% (bull market, up breakout)
Best average move in 10 days: -3.63% (bear market, down breakout)
Best 10-day performance rank: 58 (bear market, down breakout)
All ranks are out of 103 candlestick patterns with the top performer ranking 1. "Best" means the highest rated of the four combinations of bull/bear market, up/down breakouts.
The above numbers are based on hundreds of perfect trades. See the glossary for definitions.
White Spinning Top
White Spinning Top: Discussion
The white spinning top is an unremarkable candle, so let me tell you about it (that's a joke). It has a small white body but tall shadows and it acts randomly. That means the
breakout can be with or against the prevailing price trend equally.
The best average move 10 days after a breakout is a drop of 3.63% in a bear market. A good move would be 6%, so the white spinning top falls well short of that.
White Spinning Top: Identification Guidelines
|Number of candle lines||One.|
|Price trend leading to the pattern||None required.|
|Configuration||Look for a small white bodied candle with tall shadows.|
White Spinning Top: Three Trading Tidbits
If you want a few bones from my Encyclopedia of candlestick charts book, here are three to chew on. The pages refer to the book
where the tips appear.
- White spinning top candles that appear within a third of the yearly low perform best -- page 705.
- White spinning tops with shadows taller than the median outperform those shorter than the median -- page 706.
- Volume gives performance clues -- page 706.
White Spinning Top: Example
The chart shows black and white spinning tops on the daily scale. The candle at A is a black spinning top because
the body is black, small, and the candle has
shadows taller than the body. This one occurs in a downward price trend, but the breakout is upward. Thus, it acts as a reversal. And a breakout occurs when price closes either above the
top or below the bottom of the candlestick.
Candle B is a white spinning top that appears in an upward price trend. Notice the small white body and tall upper and lower shadows. Price breaks out
upward from this spinning top two days later, meaning the spinner acted as a continuation of the up trend.
Candles C, D, and E are also black spinning tops. Candles
C and E act as continuations of the downward price trend whereas candle D is a reversal.
Price enters and exits the candle from the top.
-- Thomas Bulkowski
Copyright © 2008-2013 by Thomas N. Bulkowski. All rights reserved. Well, this day was a total waste of makeup.