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| Double top reversals print when price can't push above the resistance of the last high, and then breaks under the last low. The more vertical and violent the first high appears, the more likely that the initial attempt to exceed it will fail. The longer it takes for the second rise to approach the first high, the more likely the attempt will fail. When both elements coincide, traders can consider a short sale into the second rise if: a) they are willing to exit the trade immediately if price exceeds the first high and b) the short sale will execute close enough to the first high that being wrong will incur an acceptable loss. Keep in mind that the second test of an initial high should rarely be sold short. |
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