Double tops and double bottoms look like two mountains or two valleys.
It looks like it turned back twice at a similar height, but you cannot determine the next direction based on the shape alone.
Table of contents
Remember this first
First, 3 things to remember
- 1A double top is a pattern where the price drops twice from a similar high.
- 2A double bottom is a pattern where the price rises twice from a similar low price.
- 3A completed historical pattern is different from a pattern currently in the making.
It is a name given to a similar shape.
If the price rises, falls, rises again to a similar height, and falls, it can look like two mountains. This is called a double top. Conversely, rebounding twice from a low point is called a double bottom.
Actual charts often do not fit perfectly like textbook illustrations. Just because it moved similarly twice does not determine the next price.
Look at the middle price as well.
The low point between two mountains or the high point between two valleys is often used as a reference. The line connecting these is called the neckline.
At first, rather than focusing on difficult names, look at whether it has crossed a price where it previously stalled. Do not confirm based on a single movement, as it can return.
Try finding it while hiding the future.
When looking at completed charts, it is easy to find perfect patterns. It is easy to forget that you did not know the subsequent prices at that time.
With the right side of the chart covered, write down how much you were able to discern. Looking at cases where the pattern failed will also help reduce excessive reliance on names.
You should not make such assumptions
“Since it is a W shape, a rebound is confirmed.”
Similar patterns can turn out differently later. Check cases where the pattern failed as well.
Check what you have read.
- Have you found the points where it turned back twice?
- Did you also check after the middle price?
- Have you also looked at cases where the pattern failed?
Apply what you read to the actual screen
Try it on WAPE
Source and scope of verification
Reviewed · Version 2
- Identifying Chart PatternsNew window
Fidelity Investments · Verify 2026-10-20
Gaps, reversal patterns, and confirmation conditions - Support and resistanceNew window
Fidelity Trading Strategy Desk · Verify 2026-10-20
Concepts of support and resistance · Interpretations may change after breaking out of a range
This is educational material for observation and information comprehension. Hypothetical examples do not represent actual stocks or performance and do not provide buy or sell recommendations.