Rounding top
bearish · reversal pattern
A rounding top is the bearish counterpart to a rounding bottom: a long-duration, smoothly arched price profile signalling exhaustion and slow reversal of an uptrend. Volume tracks an inverted-U: rising into the top, falling on the descent.
Formation rules
- Long-duration arched price action
- Volume profile mirrors the price arch in inverse
- Confirmation: close below prior consolidation low
How to trade it
Distribute / short during the right side of the arch on declining volume. Stop above the arch's highest point. Measured target = arch's height projected below the breakdown.
Common pitfalls
- Pattern can fail into a sideways base before resuming the uptrend
Statistical context
Less commonly catalogued than rounding bottom but symmetric in reliability when volume profile confirms.
Related patterns
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