Chart patterns
A double top, often called an M pattern, is two peaks at roughly the same level separated by a trough. It is read as a possible end to an advance, because price tried twice and failed to go higher. It is confirmed only by a close below the trough between the peaks. The double bottom, or W pattern, mirrors it.
After an advance, price makes a high, pulls back to a trough, rallies to about the same high, and turns down again - the M shape. The trough is the confirmation line: until price closes below it, the two peaks are just a range.
Most two-peak shapes never confirm. Price often breaks above the second peak instead, which is why traders wait for the close below the trough.
The common convention measures from the peaks to the trough and projects that distance down from the break. As with every pattern target, it is a planning guide, not a price forecast.
The mirror image forms after a decline: two lows at a similar level, a peak between, and confirmation on a close above that peak. The two peaks or troughs sit at an obvious level, which also makes them the support or resistance that stops cluster behind.
Step by step
Draw the pattern only once both peaks and the trough are in place.
Worked example
An illustrative sequence in words, with round numbers standing in for price. It is not taken from any real instrument or date.
The measured-move convention would suggest roughly 96. The pattern described two failed advances and a broken level; it did not say price would reach 96.
Common mistakes
Before the trough breaks, it is a range; many second peaks become breakouts.
The logic is a failure at the same level. Very different peaks are a different shape.
Without an advance before it, a double top is not a reversal pattern.
Limitations
No chart concept predicts price. These are the limits worth keeping in view.
In an evaluation
On a $100,000 simulated account the daily loss limit is $3,000 on Instant or $5,000 on 1 Step and 2 Step. Pattern stops are often wide, so size from the stop distance first - risking something like $500 a trade - rather than from how clean the pattern looks.
Very fast entries on the confirmation candle must still respect GFN's 2 minutes minimum hold time.
Questions
Keep learning
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Sources
Educational content only, not investment advice or a recommendation to trade. Chart concepts describe what price has done; none of them predicts what it will do, and trading any strategy can lose money. Get Funded Now accounts are simulated and trade virtual funds. Last reviewed 22 September 2026.
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