Is a Double Tops Chart Pattern Bullish or Bearish?

A double top chart pattern has an M shape and it occurs at a market top hence its name double top chart pattern and it signals a bearish xauusd trading price reversal in the xauusd market.

Once a double top chart pattern is confirmed then the xauusd market will be considered to be bearish, therefore a double tops is bearish.

Double Top Trading Pattern

Double tops xauusd chart pattern is a reversal pattern that is formed after an extended upwards xauusd trend. As its name implies, this double tops chart pattern formation is made up of two consecutive peaks which are roughly equal, with a moderate trough between.

This double top pattern formation is considered complete once xauusd trading price makes the second peak & then penetrates the lowest point between the highs, known as the neck line. The sell signal from this double top pattern formation occurs when the xauusd market breaks-out below the neckline.

In Gold, this double top pattern formation is used as a early warning signal that a bullish Gold trend is about to reverse. However, double top chart pattern is only confirmed once the neckline is broken & the xauusd market moves below the neck-line. Neckline is just another name for the last support level formed on the Gold chart.

Summary:

• Double tops xauusd chart pattern forms after an extended move upwards
• This double top pattern formation indicates that there will be a reversal in the xauusd market
• We sell when the price breaks-out below neckline point: see below for explanation.

Double Top Chart Pattern - Is a Double Tops Pattern Bullish or Bearish?