Descending Tops

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DEFINITION of 'Descending Tops'

A pattern in charts where each peak in price is lower then the previous peak in price. The pattern signals a bearish trend in the security.

Descending Tops



The above is an example of descending tops.

INVESTOPEDIA EXPLAINS 'Descending Tops'

If the current peak in the price is higher then the previous peak in a descending top environment, the trend is broken and this is a bullish signal.

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RELATED FAQS
  1. How important are descending tops for a trading strategy?

    The descending tops pattern is one of the most commonly occurring chart formations in technical analysis. In trading terminology, ... Read Full Answer >>
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