Chart pattern
Double Top explained
A double top is a reversal pattern in which price makes two peaks at roughly the same level, fails to move higher and then breaks below the low between them. It looks like the letter M.
How to spot it
- Identify an uptrend that reaches a clear high.
- Look for a pullback and a second rally to about the same level.
- Mark the support level at the trough between the two peaks.
- Watch for a close below that support as confirmation.
What invalidates it
The pattern is invalidated if price closes decisively above both peaks.
Common mistakes
- Calling a double top as soon as price touches the first peak again
- Ignoring that the two highs rarely match exactly, so use a zone
- Not waiting for the break of the middle trough
- Shorting into strong momentum with no confirmation
Questions
- How far apart should the two tops be?
- There is no fixed rule. They need enough separation to form a clear trough, but not so much that they are separate structures.
- Is a triple top different?
- A triple top has three peaks at the same zone. It is a similar idea with more evidence of repeated rejection.
- What is a typical target?
- Many traders measure the distance from the peaks to the trough and project it below the break. Use it as a rough guide only.
Related patterns
See how patterns are applied to a specific instrument in the market guides.
Educational content, not financial advice. Chart patterns describe what price has done and do not predict what it will do next.
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