K-line chart of gold: analysis of double top shape of gold

Analysis of K-line Technology

What is the double top shape? M head is a figure composed of two peaks, also known as double top.


In the process of price rising from position to high position, many bulls are attracted to enter the market and push the price to the high end. Investors who are long in the low position have to close their positions and leave the market due to certain book profits, which leads to the price falling. The previous high point becomes the left top of head M. When the price fell to a certain low point, bulls began to enter the market again, pushing the price up, and the low point in front became the neck line of head M. When the price rises to the front high again, affected by the risk factors, the long position will be closed, which will cause the rising price to be blocked and turn downward. The turning high will become the right top of head M. After the formation of the double top, bulls see no hope of rising, close positions and leave the market. Short sellers who hold money for purchase take the opportunity to enter the market and build positions. The superposition of the two short Forces Forces Forces Forces Forces prices to accelerate the downward trend. So m head shape is a credible top turn signal, bulls should close positions here, and can backhand short.

The decline rule of M head shape is: the decline below the neckline is at least one time of the vertical distance from the connecting line of two peaks to the neckline.


(1) This pattern should be at a high level. The larger the rise in the early stage, the more room for the future decline. Investors who short at a high level will not worry about no profit. The appearance of M head in the position should be operated carefully.

(2) The two top high points of head m should be roughly on the same horizontal line. If the difference between the two top points is too large, it is not called head M.

(3) Generally speaking, the greater the distance between the two heads, the higher the effectiveness. But it can't be too large. If the span is too large, it will lose the significance of judgment.

(4) There are two types of M head: standard type and compound type. There is only one top on the left and right sides of the standard m head, and there will be many on the left and right sides of the composite m head. Whether it is a standard type of M head, or a composite type of M head are credible short signal, can be assured operation!

Matters needing attention during operation

1、 Pay attention to choose the best short price. One of the best shorting points of M head is the price when the price falls below the neckline, and the other is the best selling point when the price rises to near or slightly over the neckline soon after it falls below the neckline, and then falls below the neckline again, so the risk is minimized.

2、 M head sometimes appears in the low adjustment market, and the space of decline is limited. Once the adjustment is in place, we should carry out somersault operation in time, because m head here is mostly in the neck position of compound w bottom shape. When the price breaks through the neck line at the bottom of W, there will be a wave of strong rising market. If we do not carry out more somersault operation in time, we will lose a chance to make money!

3、 After the formation of head m, there is also a trend of not falling but rising. In this case, stop loss in time, try to minimize the loss, and then find the opportunity to enter the market. There is a saying in the foreign exchange market: less loss means more profit. The best stop loss point of this form is 3 to 5 above the top left.

4、 When judging the market trend with m head shape, it is better to take the daily trend as the basis of judgment, and try to reduce the use of hour line or time line.

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