Double Tops and Double Bottoms: Your Quick Guide to Trading these Patterns

In the world of trading, these two patterns are like traffic signals of the market. When you see them, the price is shouting at you: “Attention, change of direction!”

The Double Roof: When the Bulls Get Tired

Let's imagine that the price rises, reaching a maximum level (first ceiling), tries to keep rising but can't. It bounces down a bit, and then… it tries again! It reaches the same maximum level for the second time, but once again fails to break through.

That's the double top, my friend. And here's the important part: that repeated failure tells you that buyers are losing strength. Selling pressure is gaining ground.

How to operate:

• Wait for the price to break down the “neckline” (the line connecting the two intermediate bounces)
• Place your short order right there
• The price should drop with good volumes

The Double Bottom: Sellers Throw in the Towel

Now mentally invest all of that. After a sharp drop, the price hits a low level (first bottom), bounces back, falls again to the same low level (second bottom) but fails to break it down.

This pattern screams the opposite: sellers are exhausted. Purchases are about to take off.

How to operate:

• Wait for the bullish breakout of the neckline
• Enter long when the breakout is confirmed
• The best moves often come after these patterns

The Key Detail

What makes these patterns powerful is precisely that repeated rejection. It is not a coincidence: it is market pressure building up, ready to explode in the opposite direction.

They are not 100% infallible patterns, but in combination with volume and a broader context, they give you odds in your favor.