June 27, 2011
- in Uncategorized by schooloftrade
Double-Tops & Double-Bottoms
What are they?
Double-Top: when buyers fail to break new highs twice. The first test completely fails, and then we try a second test that also fails.
Double bottom: when the sellers try and fail, and then try a second time and fail again.
How to find them?
Look for the candlestick WICKS to be very close in proximity for the double-tops and bottoms.
What are they trying to tell you?
Double-tops tells us the market participants see value in higher prices, they have tried twice, and they are looking for another opportunity to try again.
How to profit with them?
We already know price wants to try and test the range highs (where the 2-top occurred) so im now looking for a chance to buy.
Be patient and wait for the most IMPORTANT level of support/resistance to enter your trade.
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