CHART OF THE DAY: OH NO, It's The Dreaded Triple Top!

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Traders have been talking about the S&P’s Triple Top recently, as the index hit highs not seen since before the financial crisis began in 2008.

The Triple Top is a take on the Head and Shoulders trading pattern, that garnered attention at the end of 2011 (more on that here).

Simply, the Triple Top is three peaks perforated by recessions or sell-offs in between rallies. Volume tends to decline from the first peak to the second, and from the second to the third, something we’ve noted has been endemic to the recent trading data.

Take a look below at the pattern that’s formed over the past 14 years (longer than the few month pattern generally associated with the Triple Top).

chart of the day, s&p 500 three spikes, august 2012

Let’s put those peaks in perspective.

S&P Triple Top Historical

Photo: Eric Platt/Business Insider, Data: Bloomberg

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