A double top pattern is a technical analysis chart pattern used in trading to signal a possible reversal in a security's price trend. Its characteristics are as follows:
Two Peaks: This pattern consists of two significant peaks at roughly the same price level, separated by a trough or pullback.
Support Level: A support level is formed at the lowest point between two peaks, called the "neckline."
Bearish Reversal Signal: If the price falls below the support level (neckline) after the second peak is formed, it usually signals a bearish reversal and a potential downtrend.
Traders use this pattern to predict that an uptrend may end and prices may begin to fall.
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