Two peaks at about the same price level. Both peaks have wide, rounded looking tops
Upward price trend. Since we are dealing with tops, price must trend upward leading to the pattern and leave trending downward. Although that description may sound simple, a study of twin-peak patterns found that 65% climbed away from the pattern instead of dropping down to the confirmation line. The upward price trend leading to the double top need not be long
Top shape Both Eve peaks should appear rounded and wide, not made of a single, narrow price spike. The two peaks
should look the same.
Valley between tops Patterns with a large dip (a tall pattern) perform better than small (short) ones. The valley depth usually measures in the 10% to 20% range, but allow exceptions.
Top high prices Top to top price variation is small, usually 0% to 3%, but allow higher differences. Top separation Tops should be at least a few weeks apart with most falling in the 2–6 week range.
Confirmation price Confirmation is a close below the lowest low between thetwo tops. It confirms the twin top as a valid double top.
Upward price trend. Since we are dealing with tops, price must trend upward leading to the pattern and leave trending downward. Although that description may sound simple, a study of twin-peak patterns found that 65% climbed away from the pattern instead of dropping down to the confirmation line. The upward price trend leading to the double top need not be long
Top shape Both Eve peaks should appear rounded and wide, not made of a single, narrow price spike. The two peaks
should look the same.
Valley between tops Patterns with a large dip (a tall pattern) perform better than small (short) ones. The valley depth usually measures in the 10% to 20% range, but allow exceptions.
Top high prices Top to top price variation is small, usually 0% to 3%, but allow higher differences. Top separation Tops should be at least a few weeks apart with most falling in the 2–6 week range.
Confirmation price Confirmation is a close below the lowest low between thetwo tops. It confirms the twin top as a valid double top.
