Double top

The mirror of the double bottom, and the same three point structure inverted. Price rises to a level and turns down, falls to an interim low, rises again to approximately the same level, and turns down a second time. The horizontal line through the interim low is the neckline, and the shape is conventionally written as an M.

As with its mirror, the pattern is not complete on the second high. Two highs at a similar level describe a resistance level that has held twice, which is a common and unremarkable event; the pattern is counted only once a close occurs below the neckline. Anything named before that is a forecast about a shape that has not finished forming.

Two practical notes. Volume conventions are widely quoted, typically lighter volume on the second high than the first, and studies of them are mixed rather than conclusive. And on a chart of a currency pair the same formation described from the other side of the pair is a double bottom, which is a useful reminder that the pattern describes the drawing and not the market underneath it.