The Double Top and Double Bottom are reversal patterns used in technical analysis.

The Double Top appears after an uptrend. The price reaches a high, pulls back to the neckline (support), then rallies to a similar high but fails to break higher. A confirmed bearish reversal occurs when the price breaks below the neckline. The expected downward move is roughly equal to the distance from the tops to the neckline. Traders enter a short position after the breakdown, with a stop-loss placed above the second top.

The Double Bottom forms after a downtrend. The price hits a low, bounces to the neckline (resistance), then drops to a similar low but holds. A confirmed bullish reversal happens when the price breaks above the neckline. The expected upward move is roughly equal to the distance from the bottoms to the neckline. Traders enter a long position after the breakout, with a stop-loss placed below the second bottom.

Key differences:

- The Double Top is bearish and forms after an uptrend, while the Double Bottom is bullish and forms after a downtrend.

- The Double Top has two peaks with the neckline as support, while the Double Bottom has two troughs with the neckline as resistance.

- The Double Top confirms with a breakdown below the neckline, while the Double Bottom confirms with a breakout above.

- The entry for a Double Top is a short trade, while the Double Bottom calls for a long trade.

Both patterns require a neckline break for confirmation, and volume analysis can help validate the strength of the reversal. #bitcoin