Triple Tops and Triple Bottoms are very similar to Double Tops and Double Bottoms respectively. They, too, are reversal patterns, indicating the end of an existing trend. They form after an asset's price attempts to break past a specific level three times.
As with Double Tops, a Triple Top forms during an upward trend, suggesting that it will soon give way to a downtrend. In this case, an asset's price tests a specific level three times before it begins to fall.
Like Double Tops, Triple Tops show that buying pressure is weakening. After all, a Triple Top begins as a Double Top. It is therefore a chart pattern that cannot be traced easily in its early stages, unless a trader waits after the formation of the Double Top to see the direction in which the price will move.
Traders can take advantage of the Triple Top by going short after the price bounces off the third top, expecting the price to fall further.
A Triple Bottom pattern can be traced after extended downtrends and points towards a reversal. As the chart shows, the asset's price tested a level three times before bouncing back and pursuing an uptrend.
Naturally, Triple Bottoms commence as Double Bottoms, which makes them harder to spot. They suggest that selling pressure is almost finished.
Traders can benefit from Triple Bottoms by going long after the price bounces back from the third bottom.