Rounding Top
BearishReversalBeginnerA slow dome. Buying fades, selling creeps in, then the floor breaks.
Verdict: CautionBitcoin 4H: 41 trades, won 54%, avg trade +1.8% vs random day −3.2%. Backtest
Price climbs from a low, but the climb starts losing speed.
step 1/7
Trade rules
| Direction | Short (sell) |
|---|---|
| Entry | The first candle CLOSE back below the left rim, 25 to 180 daily candles later (30 to 260 on Bitcoin 4H), after a dome 12-45% high with its top in the middle half of that time. |
| Cancelled if | No signal if the dome is a spike (under 20% of the candles in its top third), does not fit a smooth curve, or comes back to the rim too fast or too slow. |
| Target | Dome height, projected from the breakout |
3 common mistakes
- Shorting the top of the dome before the rim breaks.
- Calling a sharp spike and drop a rounding top.
- Shorting stocks in a bull market without comparing to just holding.
Backtest
same rules every time · equal size · no fees · method| Market | Trades | Won | Avg trade | Random day |
|---|---|---|---|---|
| Bitcoin · 4H · 2017-2026 | 41 | 54% | +1.84% | −3.17% |
| US large caps (50) · 1D · 2016-2026 | 381 | 35% | −8.28% | −5.75% |
Verdict: CautionBeat a random entry in some markets, not in others.
pattern +76%random −130%
pattern −3155%random −2191%