We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Bearish
Wall Street
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
GBP/USD
Bullish
USD/JPY
Mixed
More View more
Real Time News
  • Crude oil prices wilted in Asia on Friday despite a strong start as news that China will impose more stringent control over Hong Kong saw a broad retreat for market risk appetite. Get your #oil market update from @DavidCottleFX here: https://t.co/89SH5T3315 https://t.co/awlGiVCVpc
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇨🇦CAD: 0.17% 🇦🇺AUD: 0.14% 🇬🇧GBP: 0.13% 🇨🇭CHF: -0.03% 🇪🇺EUR: -0.06% 🇯🇵JPY: -0.08% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/WHghrcxnkR
  • RT @FirstSquawk: MORE THAN 90 COUNTRIES REQUEST IMF BAILOUT
  • Heads Up:🇰🇷 Consumer Confidence due at 21:00 GMT (15min) Previous: 70.8 https://www.dailyfx.com/economic-calendar#2020-05-25
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 1.50% Gold: -0.32% Silver: -0.55% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/kxAE18eIBf
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.43%, while traders in US 500 are at opposite extremes with 77.46%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/lmh68Zio6T
  • Indices Update: As of 20:00, these are your best and worst performers based on the London trading schedule: France 40: 0.31% Germany 30: 0.24% FTSE 100: 0.09% US 500: 0.00% Wall Street: -0.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/yYNbl2JFoG
  • The anti-risk US Dollar and Japanese Yen edged higher at the expense of the growth-anchored Australian and New Zealand Dollars as US equity futures pointed lower at the start of Asia trade. Get your $GBPUSD market update from @ZabelinDimitri here: https://t.co/eUY9y46j98 https://t.co/Aj3mxhsnDy
  • Commodities Update: As of 18:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 1.50% Gold: -0.32% Silver: -0.55% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/Rrzzjyfqmz
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.44%, while traders in US 500 are at opposite extremes with 77.37%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/jjChVG5cqm
Identifying a Double Top or Double Bottom

Identifying a Double Top or Double Bottom

2010-12-07 20:59:00
Richard Krivo, Trading Instructor
Share:

Student’s Question:

I read your prev. comments on Double Bottom/Top formation. I would like to know how many candlesticks should be between both legs to qualify them…thanks.

Instructor’s Response:

The interpretation of candlestick charts has often been referred to as being more of an art than a science. As such, there is not a hard and fast number of candlesticks that need to occur between the two legs. More is better than less, and two candles right next to each other would not qualify.The process/pattern that needs to occur for a valid pattern is price action needs to touch support for a bottom or resistance for a top, trade away from that level for a time and then come back and test that level again and respect it. Ideally, a longer period of time between the two levels would lend more validity than a shorter period of time. Thepreciselength of time or number of candles is definitely debatable.Take a look at the example Daily chart below...

Identifying_a_Double_Top_or_Double_Bottom_body_32893d1246488173-post-day-double-top-chart.png, Identifying a Double Top or Double Bottom

Note how the double top pattern forms a capital letter "M". In a double bottom pattern we would be able to see a capital letter "W".Also, a textbook double top pattern will take place at a new high on the chart while a textbook double bottom will take place a new low.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.