how to trade double top pattern forex trading 2025

Now we come to one of the most important and widely used technical analysis patterns — the Double Top pattern, which appears as an “M” shape on the chart. This pattern holds a special place among traders due to its simplicity, high profitability, and solid win rate. Today, we will thoroughly examine this key pattern so that, besides becoming familiar with it, we can accurately identify it on the chart and leverage it to find profitable trading opportunities. Mastering this pattern not only increases the number of successful trades but also enhances your technical analysis skills and boosts confidence in your trading decisions.

How is the double top pattern formed and what is its shape?

When two resistance levels or peaks form side by side, it is called a Double Top pattern. This pattern is considered a strong signal to go short. By entering a sell trade at the right moment, you can take advantage of the downtrend and potentially make significant profits. Recognizing this pattern early can greatly improve your trading success.

In the image above, a Double Top pattern is displayed, and as you can see, this pattern consists of two peaks and a neckline, which we have highlighted on the image. Due to its simplicity and high profitability, this pattern is very popular among traders. It also appears frequently on charts and is easily identifiable.
By learning this pattern, you can spot excellent selling opportunities on the chart, enter sell positions at the right points, and make profitable trades.

Photo by TradingView

In the example above, on the EUR/USD chart with a 5-minute timeframe, a clear instance of a double top pattern has formed. After the formation of the second peak, we opened a sell position. As you can see, the price sharply and strongly declined, moving downward.
There are two methods to trade this pattern, and you can choose one depending on your preference and strategy. In the first method, you can enter a position right after the second peak forms, and in the second method, you can enter after the neckline of the pattern is broken.

We hope you enjoyed reading it.