Explained Trade: Double Top in EUR\USD

Aggressive trade of a Double Top, one of the most unique approaches to trading the Double Top pattern.
After the first top was identified, a second top began to form right at Resistance at 1.3400. Waited for candlestick formation to signal short entry.

A Bearish Harami signaled short trade - bearish candle that is entirely in the range of its previous bullish candle.
Entry was 1 pip below the Low of the Bearish candle. Stop Loss was placed 1 pip above the high of the Bearish candle - 28 pips.

First target of the trade was the neckline. This is an aggressive entry and therefore we don't know for sure that this is actually a Double Top. It can evolve to Triple Top, Triangle or even a Megaphone. This is why we take a conservative approach and define or first target at the neckline. If the price breaks the Neckline with strong movement we continue riding the position.

First target is 68 pips, and Stop Loss is 28. Risk:Reward ratio is 2.42, which is above 1.5 and we can enter.
Short entry triggered and reached the neckline.

Later on there was a pullback signal, price pulled back to the neckline - which also resulted in a short trade. In the next article we will talk about it.

Profit: 68 pips (+2.42% on Equity).