Double Top / Double Bottom

How it forms

The market tests a level twice but fails to push through. Each rejection is a liquidity event: stop-orders above (or below) get hunted, then large players reject. The break of the intervening pivot — the "neckline" of the pattern — confirms the regime change.

Trade plan

• Entry: close beyond the neckline + optional retest.
• Stop: above the second peak (double top) or below the second trough (double bottom).
• Target: measured move equals the height of the pattern projected from the break.

Quality filters

• Time between the two peaks/troughs should be at least 5–10 bars on the working timeframe.


• Volume should taper on the second peak/trough and expand on the break.


• Confluence with a higher-timeframe level (200 EMA, prior swing) doubles the success rate in our backtests.

Why it works

Double tops and bottoms encode the failure of trend-followers to make a new high (or low). Once the second test fails, position holders capitulate, fueling the reversal move.