Rounding Top

 

📉 Trading Strategy for Rounding Top

✅ Step 1: Identify the Pattern

• Look for a slow, curved top with lower highs.

• Confirm with decreasing volume on the way up and increasing volume on the way down.

✅ Step 2: Wait for the Breakdown

• Mark the support level (neckline) below the rounding structure.

• The breakdown occurs when price closes below this support.

✅ Step 3: Enter a Short Trade

• Enter after a strong bearish candle breaks the support level.

• Conservative traders may wait for a pullback to the breakdown level before entering.

✅ Step 4: Set Stop-Loss & Take Profit

• Stop-loss: Above the recent swing high.

• Take profit: Measure the height of the rounding top and project it downward.

📌 Example:
If the height of the rounding top is ₹50, then the target price after the breakdown would be ₹50 below the neckline.