{"id":61785,"date":"2025-06-24T10:01:32","date_gmt":"2025-06-24T08:01:32","guid":{"rendered":"https:\/\/www.captrader.com\/?post_type=glossar&#038;p=61785"},"modified":"2026-02-20T08:27:53","modified_gmt":"2026-02-20T07:27:53","slug":"double-top-formation","status":"publish","type":"glossar","link":"https:\/\/www.captrader.com\/en\/glossar\/doppeltop-formation\/","title":{"rendered":"Double top formation"},"content":{"rendered":"<p class=\"wp-block-paragraph\">The double top (also known as an M formation) is a reversal formation in the price chart of securities. The chart pattern follows an upward trend and reverses it into a downward trend, whereby two highs are formed at a similar level. In the article we explain how you can recognize the formation yourself and identify trading ideas from it.<\/p>\n\n\n<style id=\"bricks-inline-css-component-lnntzm\">\n\/* BREAKPOINT: Desktop (BASE) *\/\n.block-editor-iframe__body .brxe-rtliac:not(.tag), .block-editor-iframe__body .brxe-rtliac img{aspect-ratio: 1; object-fit: contain}\n.block-editor-iframe__body .brxe-rtliac{width: 65px}\n\n\n\/* BREAKPOINT: Desktop (BASE) *\/\n.block-editor-iframe__body .brxe-lkidxf{border: 3px solid #F6F6F8; margin-top: -60px; background-color: var(--light)}\n\n\n\/* BREAKPOINT: Desktop (BASE) *\/\n.block-editor-iframe__body .brxe-jzmkoh{font-weight: 600; font-size: var(--text-xl); text-transform: uppercase}\n\n\n\/* BREAKPOINT: Desktop (BASE) *\/\n.block-editor-iframe__body .brxe-umltno ul li{ list-style: none; position: relative; padding-left: 30px;} .block-editor-iframe__body .brxe-umltno ul li::before{ content: ''; position: absolute; left: 0; top: 0.4em; width: 15px; height: 15px; background-image: url('\/wp-content\/uploads\/2024\/02\/square-full-solid.svg'); background-size: contain; background-repeat: no-repeat;}\n\n\n\/* BREAKPOINT: Mobil Hochformat *\/\n@media (max-width: 478px){\n.block-editor-iframe__body .brxe-xowhkb{margin-top: 20px}\n}\n\n\/* BREAKPOINT: Desktop (BASE) *\/\n.block-editor-iframe__body .brxe-lnntzm{background-color: #F6F6F8; align-items: center; position: relative; margin-top: 60px; padding-right: var(--space-l); padding-bottom: var(--space-l); padding-left: var(--space-l)}\n\n\n\/* Disable links in editor *\/\n.block-editor-iframe__body a.brxe-lnntzm, .block-editor-iframe__body .brxe-lnntzm a{ pointer-events: none; }\n<\/style><div class=\"brxe-lnntzm brxe-block\"><div class=\"brxe-lkidxf brxe-div radius-full padding-s\"><img decoding=\"async\" src=\"https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Icons_Uebersicht-blau.svg\" class=\"brxe-rtliac brxe-image css-filter size-full\" alt=\"A simple outline of a document with horizontal lines and a yellow magnifying glass in front of it, symbolizing the document check or search.\" \/><\/div><div class=\"brxe-xowhkb brxe-block\"><h2 class=\"brxe-jzmkoh brxe-heading\">The most important in a nutshell<\/h2><div class=\"brxe-umltno brxe-text\"><ul>\n<li>The double top turns an upward trend into a downward trend.<\/li>\n<li>If the height of the formation is measured, a technical target for a take profit can be determined.<\/li>\n<li>Due to its appearance, the formation is often referred to as the \u201eM formation\u201c and is easily recognizable.<\/li>\n<\/ul>\n<\/div><\/div><\/div>\n\n\n<h2 class=\"wp-block-heading\">Double top formation: Structure<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The double-top formation consists of two progression highs, which are at a similar price level. There is an intermediate low between the two highs, which is important for the signal of the chart pattern. The basic idea of the pattern as a trend change formation is based on the fact that the two highs indicate that the market is reaching a resistance level that will not be exceeded. True to the motto \"What can no longer rise can fall\", there is often a sell-off in the price.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"633\" src=\"https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Formation-1024x633.png\" alt=\"Diagram of a chart pattern of the double top formation with two peaks of equal height, indicating a reversal from an uptrend to a downtrend. Labeling in German.\" class=\"wp-image-62267\" srcset=\"https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Formation-1024x633.png 1024w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Formation-300x185.png 300w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Formation-768x475.png 768w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Formation-18x12.png 18w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Formation.png 1100w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">Graphic: Double top schematic drawing<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Good to know: <\/strong>There is also a variation of the double top pattern with three highs at a similar level. This formation is known as a triplet top.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Entry, stop-loss &amp; take-profit<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">If the price of a security falls below the intermediate low, the formation is considered complete - a short signal is generated. In the literature, the level of the intermediate low is often referred to as the \"neckline\" or \"signal line\".<br>In day trading, you can understand the formation as an indication of falling prices, whereby a technical target price can be determined. To do this, the height of the formation should be measured and placed at the breakout level. For short traders, it is worth placing a take profit order here.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"531\" src=\"https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Einstieg-Stop-Loss-Take-Profit-1024x531.png\" alt=\"A line chart with a double top formation pattern, labeled with stop loss, take profit and short breakout points, as well as axes for price (PRICE) and time (TIME).\" class=\"wp-image-62268\" srcset=\"https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Einstieg-Stop-Loss-Take-Profit-1024x531.png 1024w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Einstieg-Stop-Loss-Take-Profit-300x155.png 300w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Einstieg-Stop-Loss-Take-Profit-768x398.png 768w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Einstieg-Stop-Loss-Take-Profit-18x9.png 18w, https:\/\/www.captrader.com\/wp-content\/uploads\/2025\/06\/Doppeltop-Einstieg-Stop-Loss-Take-Profit.png 1100w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">Graphic: Double top entry StopLoss TakeProfit<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Tip from the field:<\/strong> Trading is risky, and the stop loss is an excellent tool for capital protection. I recommend that you always place a stop loss.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Is the double top good?<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">Due to its simple structure, the double top formation is easy to recognize and a good formation to practice, especially for beginners in technical analysis.<br>From practical experience, I can tell you that it is important to wait for the formation to break out first! From the moment of the breakout, the double top has a high significance and effect on the chart.<br>As long as the formation has not broken below the interim low, there is a risk that the price will simply continue the previous upward trend. In this case, the double top is regarded as a consolidation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Conclusion: Simple formation for trading beginners<\/h2>\n\n\n\n<p class=\"wp-block-paragraph\">The double top formation can be found in all time frames and assets, which is why knowledge of the pattern is important for every investor. Due to its simple structure and application, the chart formation offers a good first point of reference for budding technical analysts.<br>The chart pattern is considered a classic reversal pattern, whereby an upward trend is led into a downward trend. However, it is important to note that the double top is not the strongest reversal pattern!<br>In practice, I would never make a trading decision based on this formation alone. By combining it with an indicator such as the <a href=\"https:\/\/www.captrader.com\/en\/glossary\/rsi\/\">Relative Strength Index (RSI)<\/a> or other tools, the double top can at least contribute to a decision.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Video: Trends &amp; Zones | Understanding the basis of chart analysis &amp; mastering the stock market | Christian B\u00f6ttger<\/h2>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n <div class=\"brlbs-cmpnt-container brlbs-cmpnt-content-blocker brlbs-cmpnt-with-individual-styles\" data-borlabs-cookie-content-blocker-id=\"youtube-content-blocker\" data-borlabs-cookie-content=\"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\"><div class=\"brlbs-cmpnt-cb-preset-c brlbs-cmpnt-cb-youtube\"> <div class=\"brlbs-cmpnt-cb-thumbnail\" style=\"background-image: url('https:\/\/www.captrader.com\/wp-content\/uploads\/borlabs-cookie\/1\/yt_NnT8ZwpVV8U_hqdefault.jpg')\"><\/div> <div class=\"brlbs-cmpnt-cb-main\"> <div class=\"brlbs-cmpnt-cb-play-button\"><\/div> <div class=\"brlbs-cmpnt-cb-content\"> <p class=\"brlbs-cmpnt-cb-description\">You are currently viewing placeholder content from <strong>Youtube<\/strong>. To access the actual content, click the button below. Please note that doing so will share data with third-party providers.<\/p> <a class=\"brlbs-cmpnt-cb-provider-toggle\" href=\"#\" data-borlabs-cookie-show-provider-information role=\"button\">More Information<\/a> <\/div> <div class=\"brlbs-cmpnt-cb-buttons\"> <a class=\"brlbs-cmpnt-cb-btn\" href=\"#\" data-borlabs-cookie-unblock role=\"button\">Unblock content<\/a> <a class=\"brlbs-cmpnt-cb-btn\" href=\"#\" data-borlabs-cookie-accept-service role=\"button\" style=\"display: inherit\">Accept required service and unblock content<\/a> <\/div> <\/div> <\/div><\/div>\n<\/div><figcaption class=\"wp-element-caption\">Video: Trends &amp; Zones | Understanding the basis of chart analysis &amp; mastering the stock market | Christian B\u00f6ttger<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>","protected":false},"author":50,"featured_media":0,"template":"","class_list":["post-61785","glossar","type-glossar","status-publish","hentry"],"acf":{"blog_summary":"","blog_faq_schalter":"ja","faq_uberschrift":"H\u00e4ufige Fragen zur Doppeltop Formation","blog_faq_loop":[{"blog_faq_question":"Was ist ein Doppeltop?","blog_faq_answer":"Das Doppeltop ist eine Umkehrformation in der Chartanalyse von Wertpapieren. Es kehrt einen bullischen Trend in einen b\u00e4rischen Trend um."},{"blog_faq_question":"Wie sieht der Kursverlauf nach dem Doppeltop aus?","blog_faq_answer":"Oftmals sind in Folge des Doppeltops fallende Kurse zu beobachten."},{"blog_faq_question":"Was beuuetet M Formation im Trading?","blog_faq_answer":"Die M Formation ist ein anderer Begriff f\u00fcr die Doppeltop Formation. Durch das markante Aussehen hat das Chartmuster mehrere Namen, welche in der Praxis verwendet werden."},{"blog_faq_question":"Wo finde ich das Doppeltop?","blog_faq_answer":"Das Doppeltop ist in allen Kurscharts zu finden. Das hei\u00dft in allen denkbaren Zeiteinheiten, Verm\u00f6genswerten und Charttypen (Kerzenchart, Linienchart, etc.)"}]},"_links":{"self":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/glossar\/61785","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/glossar"}],"about":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/types\/glossar"}],"author":[{"embeddable":true,"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/users\/50"}],"wp:attachment":[{"href":"https:\/\/www.captrader.com\/en\/wp-json\/wp\/v2\/media?parent=61785"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}