The Double Top Pattern is one of the most reliable FX trading signals and one of the most commonly traded. The pattern is best thought of as an "M" shape. Check out the articles below which provide more explanation on how the double top pattern works as well as practical examples of using the pattern.
A lot of interest will be focused around the AUD/JPY when trading begins this week. The AUD, which has rallied significantly against most currencies, is starting to show signs of weakness, most notably against the JPY as illustrated in the chart below which has formed a double top. Read more >>
Double Tops are an important part of any Forex Trading Strategy as they can provide an early indication that the current trend is changing direction from an uptrend to a downtrend. A typical double top starts with a prolonged rise in price for a currency, followed by a drop and then another rise to about the same level as the original rise. Finally, we see another substantial drop off from the second high. The double top pattern should eventually emulate the letter "M". Read more >>
The double top pattern is a very strong bearish signal that shows that the market’s buyers have pushed prices to new highs twice, yet failed to continue the uptrend. The psychology of the pattern is that buyers will find that they simply do not have the strength to continue the uptrend, and that they suddenly find themselves losing money. Play video >>
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