significance double top and double bottom

A Chart Pattern Double Top reversal pattern is formed once there is an extension of the movement. TOP or "peak" is formed when prices touched a certain level that can no longer be penetrated. After touching this level, then the prices will bounce a little bit, but then will return to test ketingkat the Summit again. If the price bounces from that level again, then you have a DOUBLE TOP.

The following overview of double top:

On the image of the chart above you can see that the two peaks or the "peak" was formed twice. Try you notice at the top of the second which is not able to penetrate the high Summit before. This is a strong sign that a reversal will occur that tell us that buying pressure is finished. With double top, I would order our entries below the neck because we anticipate a reversal of the uptrend.

By looking at the picture of the chart into the two above, can you can see that the price broke through the neckline (neck) and then falls down. Remember that a double peak or double top formation is a reversal of a trend so you will find this event after there was a strong uptrend. You will also notice that prices plunged roughly the same height as double top formation. It needs to be remembered because it would be useful to set a target profit (Take Profit) onward.

Double Bottom At the bottom of the double (double bottom), is also a reversal of trend formation. but this time we will be looking to go buy instead of sell. The formation occurred after a downtrend when there are two bottom has been formed.

You can see that after the trend on earlier, price formed two valleys because it cannot go below a certain level. Also note how the bottom both were not able to significantly solve the bottom of the first. This is a sign that the selling pressure is finished, and it will happen a movement reversal that will soon take place.

Price can break the neck then flying high. See how the price soaring almost equal in length with a double bottom formation. You need to remember, as happened on a double top, double bottom reversal formation as well.