What is a Triple Top Pattern? Definition, Formula, and Example
A triple top is a bearish reversal pattern formed when price tests the same resistance level three times without breaking through, signaling exhausted buying pressure.
What is a Triple Top Pattern?
A triple top is a bearish reversal chart pattern that forms when price rallies into the same resistance level three separate times and fails to close above it on each attempt. It tells you buyers pushed as hard as they could three times and got rejected at the identical price each time — the pattern completes and confirms only when price then breaks below the support level connecting the two pullback lows between the peaks. Until that break happens, all you have is a range; the triple top isn't valid until the neckline gives way.
How It's Identified
Four structural elements define a valid triple top:
1. Three peaks at approximately the same price level (within roughly 1-3% of each other for liquid large-caps; wider tolerance for small-caps or crypto).
2. A neckline — the horizontal support level drawn through the two troughs between the three peaks.
3. Volume divergence — volume is typically lower on the second and third peaks than the first, showing weakening buying conviction even as price revisits the same level.
4. Confirmation — a daily close below the neckline, ideally on expanding volume.
The price target after confirmation uses the same measured-move math as a double top: subtract the height of the pattern (distance from the resistance line to the neckline) from the breakdown point.
Target = Neckline price − (Resistance price − Neckline price)
Worked Example
Gold gave a textbook triple top from late 2017 into mid-2018. Price rallied to roughly $1,360/oz on three separate occasions with pullbacks in between, each rejection occurring at essentially the same ceiling. The neckline — the support connecting the intervening lows — sat near $1,300. When gold broke below $1,300 in May 2018, the measured-move target (pattern height of $60 subtracted from the $1,300 breakdown point) projected toward the low $1,200s; gold subsequently traded down to roughly $1,226/oz. Equity examples show the same mechanics on individual names like XOM and SQ, where three swing highs form at a shared resistance level before a neckline break triggers the downtrend leg.
When Traders Use It
Traders use a triple top as a short or put-buying signal once the neckline confirms, not before — entering on the third touch alone is a bet on a pattern that hasn't finished forming. Swing traders place stops just above the resistance line (invalidating the pattern if price makes a fourth higher high) and target the measured-move level as a first profit-taking zone. It's also used defensively: holders of a long position watching a name test the same ceiling a third time often tighten stops or trim size ahead of confirmation, since three failed breakout attempts at an identical level is itself a warning sign regardless of what happens next.
Limitations and Common Misconceptions
A triple top is a *lower-probability* variant of the more common double top — by the time price tests a level a third time, it has already telegraphed the resistance to every algo and discretionary trader watching the chart, which can make the eventual breakdown sharper but also makes false breaks more common as stop-hunting algos run the level before reversing. The pattern is descriptive, not predictive: it says buyers failed three times, not why, and it carries no information about magnitude beyond the measured move, which is a rule of thumb, not a guarantee. It also requires genuine separation between peaks — three closes in the same week at the same price is consolidation, not a triple top. Finally, like all reversal patterns, it can be violated instantly by a fundamental catalyst (earnings, Fed decision, M&A news) that has nothing to do with the technical setup.