Explanation of the Double Top model
The double top pattern is one of the important classic reversal patterns. It comes at the end of an uptrend, or after a correction in a downtrend. The model consists of two peaks.. The second peak may be at the same level as the first peak, or slightly higher or slightly lower.
How to create a model:
Buyers raise prices to a new high, after which sellers begin to appear They drop prices to form a new bottom or support level Then buyers push prices up again to form the second peak Which is usually approximately at the same level as the second peak Then sellers push prices back down again to form the second peak.
How to use the form:
The model, as we mentioned, is one of the reflexive models, so if it appears, we start looking for sales. Sell entry is made after breaking the neckline (previously formed support level)
After retesting, entry to the broken neck level. It is possible to enter sell immediately after breaking the neckline, but this method carries some risk Therefore,
it is more preferable to enter after retesting.
How to set a goal:
The distance between the neckline and the peaks is measured The same distance is taken as a target for sales operations.
