Technical Indicators

Multiple Top Pattern

Both the double top and triple top are toppings patterns, so when the pattern “completes” consider exiting long positions and focus on taking short positions. The uptrend is now over and a downtrend is likely underway

Multiple Bottom Pattern

A double bottom pattern describes the drop of a stock or index, a rebound, another drop to the same or similar level as the original drop, and finally another rebound. The double bottom looks like the letter “W”. The twice-touched low is considered a support level.

Head and Shoulders Pattern

The head and shoulders pattern is believed to be one of the most reliable trend reversal patterns. It is one of several top patterns that signal, with varying degrees of accuracy, that an upward trend is nearing its end.

Inverse Head and Shoulders

An inverse head and shoulders pattern, upon completion, signals a bull market. Investors typically enter into a long position when the price rises above the resistance of the neckline

Wedge Resistance and Support

Wedge patterns are usually characterized by converging trend lines over 10 to 50 trading periods. The patterns may be considered rising or falling wedges depending on their direction. These patterns have an unusually good track record for forecasting price reversals.