Follow Us

triple_top

Triple-Top Forex Pattern

The triple top is a hybrid of the head-and-shoulders and double-top trend reversal formations. Conversely, the triple bottom is a hybrid of the inverse head-and-shoulders and double-bottom formations. Consequently, they have the same characteristics, potential problems, signals, and trader's point of view as the double top or double bottom, respectively.

triple_top

As shown in the Figure in a typical triple-top formation, the tops have about the same height. A parallel line (the neckline) is drawn against the line connecting the three tops (B, D, and F.) As a resistance line, the neckline is broken at point A. It turns into a strong support for price levels at С and E, but eventually fails at point G. The support line turns into a strong resistance line, which holds the market backlash at point H. The price objective is at level I, which is the average height of the three tops formation, as measured from point D (see the dotted lines).

As a double top, the formation fails at point E. The price moves up steeply toward point F. The resistance line is holding once more and the price drops sharply again toward point G. At this level, the market pressure is able to penetrate the support line. After a possible retest of the neckline, the prices drop further, to eventually reach the price objective.

Top Forex Brokers Reviews here

Register_big