A double top is a bearish reversal chart pattern that forms when an asset's price rises to a resistance level twice, creating two peaks at approximately the same price with a moderate decline between them. The pattern is confirmed when the price breaks below the support level between the two peaks, known as the neckline. It signals that buying pressure is exhausting and sellers are gaining control, often preceding a significant downtrend.
Example
“The currency pair hit 1.2500 twice before falling, forming a double top, and when it broke below the 1.2350 neckline, traders went short expecting further decline.”