Triple Top and Triple Bottom Formation
The Triple top is a type of Bearish chart used in technical analysis to predict the reversal of an asset’s price movement. Consisting of three peaks, a triple high indicates that the asset can no longer rise and that prices may be lower.
Triple charts can appear in all time periods, but for a pattern to be considered a triple chart, it must appear with an upward trend. The opposite of a three is a triple bottom, which indicates that the asset’s price is no longer falling and could rise higher.
A triple bottom is a Bullish chart used in technical analysis characterized by three equal lows followed by a break above the resistance level.
Triple top and triple bottom chart patterns are based on the notion that three tops or three bottoms can be found almost at the same price level. The forecasting value is the greatest if there is a goo symmetry between the peaks or the troughs or the valleys. Ideally, the distance is the same from the middle peak to the peaks to both the left and right.
A triple top chart formation is completed when the low, which is before the third peak, is broken on a close basis. If the third peak in a triple top formation is a false breakout, this is a STRONG indication of a Trend Change. The total distance between the peaks and valleys can be used as the initial profit target.