The M that has not happened yet

What the Lesson Covers

1. 0:00An M on a chart is not a double top. It becomes one at a price, and that price comes last.
2. 0:06The shape. A high, a real decline, a return to the same high, and a turn down. Messier than the bullish mirror, because tops are built out of impatience.
3. 0:17Why it forms. The first high says supply appeared once. The second asks whether the buyers are still there, and lighter volume says they are not.
4. 0:27The levels that matter. The neckline, the two highs, the height between them, and how the volume compares. The comparison matters more than the symmetry.
5. 0:37Where it completes. A close below the neckline completes it. Above the higher of the two highs there is nothing on the chart for the pattern to describe.
6. 0:48How often it follows through. Sixty-one to sixty-seven, just under the bullish mirror, because the market's long-run drift works against every bearish reversal.
7. 0:57The same shape failing. The third push. The break is reclaimed, price clears both highs, and the top turns out to have been a long pause.
8. 1:08The tells. A heavy second high, a shallow decline into the neckline, or a break that closes back above it within days.
9. 1:18The neckline is the pattern. The two highs are only the picture.