Triple top

What it is

A triple top is a reversal pattern at the end of an uptrend. Price rallies to a high and fails, pulls back, rallies to the same high and fails again, then does it a third time. The two pullback lows form a support line. The pattern completes when price closes below it.

It is a close relative of the double top, with one more failed attempt. It also resembles a head and shoulders, except that the middle peak is not higher than the other two.

Why it forms

Each top marks a level where sellers outnumber buyers. The first failure could be a normal pause. The second shows the supply is still there. By the third, buyers have tested the same price three times without clearing it, and every rally has been sold.

The pullback lows matter just as much. They are where dip-buyers keep stepping in. Once price closes below them, those buyers are holding losing positions, and many sell to limit the damage. That selling, plus new short sellers, can speed up the move down.

How to identify it

• A clear uptrend leading into the pattern.
• Three peaks at roughly the same price. They rarely match exactly; what matters is that the same zone keeps capping price.
• Two pullbacks between the peaks that stop near a similar low. That shared low is the support.
• Time between the peaks. Tops that form over weeks on a daily chart carry more weight than tops a few candles apart.
• Volume often fades from the first top to the third, a sign that buyers are losing interest.

What confirms it

A candle close below the support formed by the pullback lows. Higher volume on that close strengthens the signal. A retest of the broken support from below that fails is further confirmation.

What invalidates it

• Price closes above all three tops. The resistance has been absorbed and the bearish case no longer holds.
• After breaking support, price quickly recovers and holds back inside the range.

Common mistakes

• Calling it on the third top. Until support breaks, a triple top is a range, and ranges can break either way.
• Confusing it with a head and shoulders. If the middle peak is clearly the highest, it is a head and shoulders, and the neckline and measured move are drawn differently.
• Ignoring the trend. Three touches of resistance in a sideways market is a range, not a reversal.
• Treating the measured move as a price target. It is a reference for scale, not a forecast.