What Is a Triple Top?
Three peaks at approximately the same level with two intervening pullbacks create a horizontal resistance ceiling. Support connects the pullback lows—neckline for the pattern. Each failed rally shows sellers absorbing demand. Triple tops take longer than double tops to form—distribution is extended. Measured move uses tallest peak to neckline distance projected down from breakdown. Sometimes middle peak is slightly different height—focus on three clear rejections, not perfect equality.
Triple tops often appear at multi-year highs where each tag attracts media attention and retail chase.
How Do You Identify a Triple Top?
Three distinct tests of resistance with visible pullbacks between. Volume often declines on each successive peak attempt—exhaustion. Neckline across lowest points between peaks. Pattern requires prior advance for reversal context. Distinguish from ascending triangle—triangle has rising lows, triple top has similar lows between peaks. Time span proportional to timeframe—three tags in one hour is scalper structure; three tags over quarters is secular top.
Third peak failure is psychological inflection—many traders tighten risk after two prior rejections.
What Confirms the Breakdown?
Close below neckline on expanding volume. Failed third peak is last chance to exit longs before break. Retest of neckline from below for short entry. Break after third peak should not reclaim resistance quickly. Sector weakness on break day improves odds. Spring below neckline that recovers traps shorts—watch second session. Down-sloping neckline from rising pullback lows breaks earlier—adjust triggers.
Partial position reduction after second peak is valid risk management before pattern completes.
Compare peak spacing in time—compressed triple tops in parabolic moves often fail differently than months-long distribution at secular highs.
How Do Stops and Targets Work?
Stop above third peak or above neckline on failed breakdown trade. Measured target subtracts peak-to-neckline height from break point. Partial cover into vertical decline. Trail below lower highs. Wide pattern equals wide stop—size down. If support was tested many times before break, move may accelerate—do not insist on single exit at target.
Compare triple top to head and shoulders—center peak not required to be highest in triple top.
When Do Triple Tops Fail?
Fourth breakout above resistance—pattern becomes consolidation breakout bullish. False breakdown below neckline. Mega-cap index triple tops in bull regimes often resolve up. Only two peaks then breakout—was double top, not triple. Low-volume holiday break reverses. Short squeeze through ceiling on third attempt. Honor breakout above resistance as invalidation immediately.
Extended triple tops can morph into rectangles—break direction still matters more than label.