Double Tops and Bottoms – One of the many binary options
There are many patterns available to understand the market and adopt a binary options strategy, to trade in the market. There are many reversal patterns which occur in the volatile market and one such reversal pattern is Double and Triple Tops and Bottoms. Double Tops and bottoms is one of the binary options which are quite similar to the head and shoulder pattern.
These patterns are just a variant of the head and shoulders pattern, where you would find both the head and the shoulders equally big. Binary Options Strategy can be understood if one analyzes this pattern. Double tops and Triple Tops are indicators of up trends being reversed, and on the other hand double bottoms and triple bottoms are indicators of downtrends being reversed.
These patterns can be used by the binary options traders, equally effectively as the pattern of head and shoulders. As we have already discussed in short, the binary options of Double and triple tops, now we shall discuss them in detail. When the asset price is on an upward trend, then the double top is created, which look like two peaks which are side by side, and are at the price level, which is same.
There is a reversal of trend when the price falls below the valley which is formed between the two peaks. This is the point where the binary options trader could trade to his advantage. A double bottom is the reflection of the double top. This can be seen as two valleys which is at the end of the downtrend which have similar or near similar points, which are low. Similarly Triple tops are even more powerful indicators than the double tops, thus help us in forming the binary options strategy, to our advantage.
Both of them are quite similar but just that double tops-as the name suggests, has two peaks and triple tops has three peaks. When the lows of the valleys between the peaks are broken, there would be an end of the uptrend, and the traders should expect the price to move downwards. Triple bottoms are again the reflection of triple tops.
Triple bottoms contain three valleys and the downtrend is reversed when the high points between the valleys are broken. Binary options traders understand very well that triple tops and triple bottoms are more powerful than the double tops and double bottoms. These binary options are seriously considered by them as they are more sure indicators of reversed trends