The easiest reversal pattern to recognize.
Double top
- Two highs at a similar price level, separated by one low (the neckline).
- Appears after an uptrend. Shows that buyers failed to make a higher high.
- Trigger: price breaks and closes below the neckline.
- Stop: above the second high.
- Target: the height of the pattern (high → neckline) projected downward from the neckline.
Double bottom
The mirror image: two similar lows after a downtrend, triggered when price breaks above the neckline.
Key points
- The highs/lows do not have to be exactly equal — a close range is enough.
- Confirm with a close through the neckline, not just a touch.
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