Triple top and triple bottom are reversal

chart pattern A chart pattern or price pattern is a pattern within a chart when prices are graphed. In stock and commodity markets trading, chart pattern studies play a large role during technical analysis. When data is plotted there is usually a pattern which n ...

s used in the

technical analysis In finance, technical analysis is an analysis methodology for analysing and forecasting the direction of prices through the study of past market data, primarily price and volume. Behavioral economics and quantitative analysis use many of the sam ...

of stocks,

commodities In economics, a commodity is an economic good, usually a resource, that has full or substantial fungibility: that is, the market treats instances of the good as equivalent or nearly so with no regard to who produced them. The price of a comm ...

, currencies, and other assets.

Triple top

Formation The formation of triple tops is rarer than that of double tops in the rising market trend. The volume is usually low during the second rally up and lesser during the formation of the ''third top.'' The peaks may not necessarily be spaced evenly like those which constitute a Double top. The intervening valleys may not bottom out at exactly the same level, i.e. either the first or second may be lower. The ''triple top'' is confirmed when the

price A price is the (usually not negative) quantity of payment or compensation given by one party to another in return for goods or services. In some situations, the price of production has a different name. If the product is a "good" in the c ...

decline from the ''third top'' falls below the ''bottom'' of the lowest valley between the three peaks. Selling strategy There are several different trading strategies that can be employed to take advantage of this formation. Of course, first and second peaks are perfect point to place sell orders. After the double top has been confirmed and if prices are moving up again with low volume, it is an opportune point to sell. One can sell short with a stop (calculated loss) above the highest peak of the Double top. The next opportune point to sell would be after a Triple top has formed and a fourth top is being formed at the lower level. Notes Observation shows that it is rare to see four tops or bottoms at equal levels. In case prices continue to rally up to the level of the three previous tops, there is a good chance that they will rally up higher. If they come down to the same level a fourth time, they usually decline. Triple tops are also noted to be similar to barts as found in cryptocurrency trading.

Triple bottom

Most of the rules that are applied in the formation of the triple top can be reversed in the formation of ''triple bottom.'' As far as volume is concerned, the third low bottom should be on low volume and the rally up from that bottom should show a marked increase in activity. The formation of Triple bottom occurs during the period of

accumulation Accumulation may refer to: Finance * Accumulation function, a mathematical function defined in terms of the ratio future value to present value * Capital accumulation, the gathering of objects of value Science and engineering * Accumulate (highe ...

References

External links

Triple Bottom Video with Statistics and Price Targets

''Analyzing Chart Patterns: Triple Tops And Bottoms''
at investopedia.com
''How to Trade the Double Bottom Pattern''
at StockChartPatterns.org
" double top pattern "
at thebahas.com {{technical analysis Chart patterns