Double Top Pattern
Original schematic showing the guide's principal visual relationships.
First peak → reaction low → second peak; confirmation is a close below the reaction low.
Pattern anatomy
A bearish reversal pattern formed by two failed tests of similar resistance separated by a reaction low.
First peak → reaction low → second peak; confirmation is a close below the reaction low.
How it works
Identify the prior trend first, mark repeated swing highs and lows, then draw only the support, resistance, or neckline justified by those pivots. A pattern remains provisional until price closes beyond its confirmation boundary; visual resemblance alone is not enough.
How to read it
The second rejection suggests demand is no longer strong enough to clear resistance. The peak-to-reaction distance is often projected downward after confirmation.
Practical example
Price rejects the same resistance zone twice, with a clear reaction low between the peaks. The setup remains only a range until price closes below that reaction low; the height from resistance to support can then frame, but not guarantee, a downside objective.
Confirmation checklist
Look for an established prior trend, a completed boundary break, and preferably expanding volume or momentum confirmation. A reversal pattern formed without a trend to reverse is weaker evidence.
Limitations and false signals
Two nearby highs are not enough: without a break of the intervening low, the structure remains a range rather than a completed top.
Limitations and false signals
Frequently asked questions
What does this pattern or indicator describe?
A bearish reversal pattern formed by two failed tests of similar resistance separated by a reaction low.
How should the signal be confirmed?
The second rejection suggests demand is no longer strong enough to clear resistance. The peak-to-reaction distance is often projected downward after confirmation. Look for an established prior trend, a completed boundary break, and preferably expanding volume or momentum confirmation. A reversal pattern formed without a trend to reverse is weaker evidence.
What can cause a false signal?
Two nearby highs are not enough: without a break of the intervening low, the structure remains a range rather than a completed top.