Ascending Tops

AAA

DEFINITION of 'Ascending Tops'

This refers to a series of peaks, each peak higher than the previous one on the stock's chart pattern. Ascending tops are created following a previous and subsequent trough. This may look like a mountain range in which each mountain top is higher than the last.


The chart below illustrates a series of four ascending tops.

Ascending Tops



INVESTOPEDIA EXPLAINS 'Ascending Tops'

For technical analysts this is considered a very bullish indicator. The ascending tops pattern points to a situation where the market has determined that the price of a stock is intrinsically greater than it was during the previous period, when traders sold off the security following a high. The sell-off might be viewed as profit taking, thus explaining the security's subsequent rise to a new high.

RELATED TERMS
  1. Cup and Handle

    A pattern on bar charts resembling a cup with a handle. The cup ...
  2. Head And Shoulders Pattern

    A technical analysis term used to describe a chart formation ...
  3. Technical Analysis

    A method of evaluating securities by analyzing statistics generated ...
  4. Mass Index

    A form of technical analysis that looks at the range between ...
  5. Money Flow Index - MFI

    A momentum indicator that uses a stock’s price and volume to ...
  6. On-Balance Volume (OBV)

    A momentum indicator that uses volume flow to predict changes ...
Related Articles
  1. Four-Week Rule Boosts Winning Trades
    Trading Systems & Software

    Four-Week Rule Boosts Winning Trades

  2. Trade On Support For The Best Exit Strategy
    Active Trading Fundamentals

    Trade On Support For The Best Exit Strategy

  3. Using Volume Rate Of Change To Confirm ...
    Active Trading Fundamentals

    Using Volume Rate Of Change To Confirm ...

  4. How To Interpret Technical Analysis ...
    Forex Education

    How To Interpret Technical Analysis ...

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center