7.25What is a double top?
1What is it?
A double top is an "M" shape: price hits the same high twice and fails, then breaks below the dip between them (the neckline).
2Why does it exist?
Buyers failed twice at the same level, suggesting the uptrend may be ending.
3Diagram
4Calculation
Target ≈ Neckline − (Top − Neckline)
- Top ₹480, neckline ₹450 → height ₹30.
- Target ≈ ₹450 − ₹30 = ₹420.
Measured move target ≈ ₹420 (rough guide only).
5Quick revision
- "M" shape.
- Confirmed below neckline.
- Bearish reversal.
6Knowledge check
Q1. Shape of a double top?Show answer
M.
Q2. What confirms it?Show answer
A close below the neckline.
Q3. Top ₹200, neckline ₹180. Target?Show answer
≈ ₹160.