You’ve probably heard me talk about Reversal Patterns before. Today, I wanted to share 2 trade setups based on Reversal Patterns. This reversal pattern is called Double Top.
Trade 1: In this first trade, we look at the GBPUSD 15 min chart. The trade sets up at 1.5800 which has proved to be an important support and resistance level on the 4 hour chart. The price pushes into this level with momentum but fails to hold above this level. Price bounces off of 1.5800 the first time but then goes back to test the same level again. Price is rejected again and we see a nice pin bar candlestick pattern form at this level. We see multiple attempts by price to push through this level but these attempts fail every time. This can be seen by the multiple pins (candlestick wicks) into this level. We enter the trade at 1.5785 as the price breaks through the midpoint and comes back to retest this level. The overall move was over 130 pips allowing us to bank over 100 pips in this trade.
Trade 2: Here’s another example of the Double Top reversal pattern. This setup is again on a 15 minute timeframe. The 15 minute timeframe is usually an easy to trade timeframe for this setup. Here, we see price trying to break through the 1.0920 level. The 20 levels are usually good technical levels where we often see price react. Again, this was a good support and resistance level on the 4 hour chart giving us a high level of confidence for this level to hold. We see the price break through this level but failing to hold above for any length of time. The price throws multiple pins into this level before breaking down and dropping nicely. The entire move was over 100 pips, giving us an opportunity to bank 85 pips.
I see these patterns setup on multiple time frames and can be quite profitable to trade. Keep an eye out for the Double Top reversal patterns to setup at key support and resistance levels for the best trades.
I have found this setup to be very profitable and look for it to setup at key levels. I’ll be teaching Reversal Patterns, including this one in the “Learn to Trade Forex” course starting July 11th. We’ll also cover my “3 Signature Trade Strategies” that are not just profitable but setup consistently every week . Click on the link below to learn more about the course and reserve your spot.
Learn more about the “Learn to trade Forex” course.