Double tops and bottoms are patterns that can be drawn in many variations and every trader can potentially interpret them in ways that are applicable to their own style of trading. However, there are certain basic patterns that can help traders establish support and resistance lines more logically versus random drawings.
The three types of double top patterns
Before we get into actual chart studies, we have to address the different types of double tops and what they mean for traders.
The first double top on the far left is the classic double top. This is what you usually see in trading literature or on other trading websites. However, this pattern where you have two swing highs at the same level are rare and trading from a mindset where double tops must look like this can lead to many problems. Also, when you go through a chart you won’t see all the failed