Double Top

As shown above is a pattern call Double Top. It is seen on share price chart as a very potent signal that price is going to go down in the near future. Double Top is form when price was rejected from the recent high (top). People try to sell their share at the 2nd Top because they are afraid that the share price will be rejected from the Top again which trigger a huge sell off. This is the basic psychology behind the double top. So every time you see a double top pattern, there is a high probability that the share price will drop in the near future. Note that I use probability here, cause in the share market there is really no guarantee that the price will go a certain direction after a particular pattern.What this pattern really tell us is the probability of share price going in down is higher.

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