What's Double Tops Crude Oil Trading Chart Patterns in Oil Trading?

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This Double Tops patterns charts guide explains how to identify crude oil patterns - identifying crude oil chart patterns is the first step when it comes to learning how to oil trade with Double Tops crude oil chart patterns in Oil Trading.

Double Tops crude oil price patterns commonly form on Oil Trading charts & this crude oil chart pattern analysis guide explains how to trade and analyze oil charts using Double Tops crude oil trading chart patterns.

Double Top Oil Trading Pattern

Double tops crude oil pattern is a reversal oil trading pattern which forms after an extended upward oil trend. As its name implies, this double top crude oil chart pattern formation is made up of 2 consecutive peaks which are roughly equal, with a moderate trough between.

This double tops crude oil pattern formation is considered complete once crude oil price makes the second peak & then penetrates the lowest point between highs, known as the neck line. The sell oil signal from this double top crude oil pattern formation occurs when the crude oil market breaks-out below neckline.

In Oil Trading, this double tops crude oil pattern formation is used as a early warning trading signal that a bullish Oil Trading trend is about to reverse. However, double top crude oil pattern is only confirmed once the neckline is broken & the crude oil market moves below the neck-line. Neckline is just another name for the last support level formed on the Oil Trading chart.

Summary:

• Double tops oil pattern forms after an extended move upwards
• This double tops crude oil chart pattern formation indicates that there will be a reversal in crude oil market
• We sell when crude oil price breaks out below the neck-line: see below for the explanation.

What is Double Tops Crude Oil Trading Chart Patterns in Oil Trading?

The double tops crude oil chart pattern look like an M Shape, the best reversal oil signal is where the second top is lower than the first one as shown below, this means that the reversal oil signal can be confirmed by drawing a downwards oil trend line as shown below. If a trader opens a sell oil signal the stop loss will be placed just above this downward oil trend line.

M Shaped Double Tops Oil Trading Chart Pattern - What is Double Tops Crude Oil Trading Chart Patterns in Oil Trading?