Triple top: how to recognise and trade it

Bobby

Written by Bobby

Triple top: how to recognise and trade it

What is a triple top?

A triple top is a bearish reversal chart pattern that forms when price tests the same resistance area three times without breaking through.

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The pattern has three highs in the same price area, separated by two pullbacks.

Those pullbacks form horizontal support called the neckline.

Like a triple bottom, this pattern can appear on any timeframe.

How do you recognise it?

A triple top has the following features:

  • An uptrend before the pattern appears
  • Three highs in the same price area
  • Two pullbacks between them that form a clear support level
  • A break below the neckline to confirm the pattern
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With a triple top, buying volume often tends to fall from one high to the next.

This shows buyers gradually losing their advantage as control shifts to sellers.

The main difference from a double top is a third test of resistance, which also makes it a rarer pattern.

How do you trade a triple top?

  1. Sell the breakout: enter when a candle closes below the neckline
  2. Wait for a return to the neckline: after the breakout, price sometimes retests this level before continuing lower

The stop-loss can go above the area of the three highs.

It's much easier than you think...

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Bobby

Written by

Bobby

Independent trader

I'm a former financial engineer and spent seven years on trading floors and at a hedge fund. For over three years, I've been sharing my trading experience and what I know about finance.