Double Top Practice
A double top is two failed attempts at the same high — an "M" shape that warns buyers are running out of room. Train to wait for the neckline break instead of front-running it.
A double top forms when price rallies to a high, pulls back, then rallies again to roughly the same level and fails. The low between the two peaks defines the neckline; a decisive close below it confirms the reversal and projects a target equal to the height of the pattern.
How to spot it
- ✓ An uptrend leads into the first peak.
- ✓ Two peaks form at a similar level — they do not need to be identical.
- ✓ The dip between them sets the neckline.
- ✓ Confirmation is a close below the neckline, not the second peak alone.
- ✓ Volume often fades on the second peak — a useful tell.
⚠️ Common mistake
Shorting the second peak before the neckline gives way. Two highs at a level are common in a healthy uptrend; without the neckline break it is just a pause, not a top.
FAQ
How close do the two peaks need to be?
Roughly the same level — within a small percentage. Real patterns are imperfect; the neckline break matters more than identical peaks.
What target does it imply?
Measure the height from the peaks to the neckline and project it down from the break. It is a rough guide, not a guarantee. This page is practice, not advice.