Forex School Advanced Level: Double Top and Double Bottom Strategy


 

Double top is technical formation for reversing uptrend. Market reaches new higher value and after that sellers come across and market is retracing (first top has been formed). Area where sellers are exhausted and buyers gather some power is local low. When buyers outnumber sellers they want to make higher high, but couldn’t break previous high and they close at the same level (second top). Then sellers outnumber buyers and send price to neck line. If price break neck line Double Top is confirmed.

 

 Double Top 1024x501 Forex School Advanced Level: Double Top and Double Bottom Strategy

 

IF you are an aggressive trader you can short 2 or 3 bars after which the second top was formed and to put stop 5-10 pips above second top..

If you are conservative trader you can wait the price to break neck line and then go for short. You must place your stop loss order 5-10 above second top.

You can apply the same strategy for Double Bottoms.

 





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