Originally published by guppytraders.com
One of the most powerful chart features is the doubletop. Even more powerful is the triple top patterns. These patterns show long termconsistentresistance and serve the push the market down. A double top is bearish. A triple top is even more bearish.
The DOW has a well-established and testedtriple top pattern. Reactions away from this resistance level have caused the DOW to become trapped in asidewayspattern for most of 2018. The period included a substantial dip below the lower edge of the trading and in December 2018.
Currently the DOW isagaintesting this triple top resistancepattern with a move towards 26600. There is a high probability of a retreat from this resistance level and a continuation of the sideways trading pattern.
But, conversely, a breakout above this well-established resistance level is very bullish because it shows the market has the strengthtoovercome this long-term resistance. The tradingband is used to set an upsidetarget. The width of the band ismeasured, and the value is projected above the resistance level. This gives a target near 29700.
Traders are ready to go short, but only if there isconfirmationof a retreat from resistance. Traders will go long if there is a substantial weekly close above the resistance level that has, to date, acted the triple top pattern.