New York, November 1st (TradersHuddle.com) - Nokia Corporation (NYSE:NOK) closed the trading session higher by $0.11 or 4.3% from its previous close. The latest price action developed a short term reversal pattern in the form of a tweezer top, which is a candlestick pattern that is usually formed at the end of an uptrend. Given that the tweezer top is considered a reversal pattern, traders with long positions need to monitor the price action for confirmation of weakness, and plan the position accordingly.
Nokia Corporation (NYSE:NOK) manufactures and sells mobile devices, and provides Internet and digital mapping and navigation services worldwide. The Finland based company is the largest mobile phone maker in the world. Additionally the company provides equipment, solutions and services for communications networks.
Nokia's stock has been in a defined range with calculated support at $2.56 and resistance at $2.95. Given the possibility of short-term weakness in the stock's price, this range could be used by traders managing their positions.
Tweezer tops are exactly the opposite of tweezer bottoms, as they define a resistance point for Nokia that needs to be digested prior for the stock to move to a higher level.
Tweezer tops can be formed at the end of an uptrend, at a clear horizontal resistance point, or within a downtrend when price action is dealing with the declining resistance trend. Like any other candlestick pattern, it needs confirmation by trading below the previous day low. Below there is an example of the Tweezer Top reversal pattern:
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