Top or Bottom reversal?

[iMusingKiMi]

One can look for those or for a regular double top or double bottom. The latter two are especially reliable if they're combined with a clear candlestick pattern that is also signal for a reversal, like a hammer candlestick, a hanging man or a shooting star candlestick. Generally it's a good idea to read up on different candlestick patterns, because there are many patterns other than the ones I listed, that can provide good, reliable signals for an impending reversal and they can be applied to pretty much all time frames.

Yeah, I do agree double top or double bottom quite reliable as well. But remember, Double Top and Double Bottom need some period to double confirm. It is difficult to explain what I mean, but if a double top or double bottom form in a very short time, it usually don't works. That's what I can share.

 

[dianajs]

Yeah, I do agree double top or double bottom quite reliable as well. But remember, Double Top and Double Bottom need some period to double confirm. It is difficult to explain what I mean, but if a double top or double bottom form in a very short time, it usually don't works. That's what I can share.

That is why I recommended using a double top or a double bottom combined with a candlestick that is also a signal for a reversal. That combination is usually enough of a confirmation that such a reversal is about to occur, at least in my experience. Generally speaking, it's always good to have a second signal to confirm the first, regardless of what the actual signal you're looking at is. For example, a reversal candlestick pattern is much more reliable when it occurs above a strong support or a below a strong resistance level, compared to the ones that form in the middle of nowhere.

 

[downtrend]

Try to spot Tweezer Top or Tweezer bottom. It usually give a highly reliable signs for reversal.

And yes there are other reversal patterns as well but a trader has to keep in mind the most important thing, money management, while trading any pattern at any location.

 

[dianajs]

And yes there are other reversal patterns as well but a trader has to keep in mind the most important thing, money management, while trading any pattern at any location.

I would say that looking for reliable reversal patterns is part of good money management because with their help we can make good trading decisions.

 

[downtrend]

A better way to trade such reversals is that you should wait for the market to do a retest. On confirmation of a retest of such reversal you can enter more confidently and odds of wining will also be more.

 

[EURUSD]

Learning on reversal time also need good experience, indeed usually after trend aalready figure out hence not always will move instantly continue the trend, sometime occur area that often retest and likely hard to breakout, waiting reversal time might will lower the risk