📍 Entry / Short Zone
Neckline Break
Short on a candle close below the neckline — the trough between the two peaks.
🛑 Stop Loss
Above the Peaks
Place the stop just above the double-top resistance.
🎯 Price Target
Neckline − Pattern Height
Measure from the peaks down to the neckline, then project that distance below the break.
⚖️ Risk / Reward
Aim for ≥ 2:1
Only trade it when the measured target offers at least twice your risk to the stop.
Trading Rules — Double Top
01Two equal peaks. Price tests the same resistance twice and fails, forming an 'M'.
02The neckline. The low between the peaks is support; breaking it confirms the reversal.
03Second peak weaker. Lower volume or momentum on the second peak signals buyers are exhausted.
04Wait for the close. Don't anticipate — require a candle close below the neckline.
05Aggressive option. Some traders short the second-peak rejection with a tight stop above resistance.
For educational purposes only. Not financial advice. Always manage risk with position sizing and never risk more than you can afford to lose.