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Sunday, 11 December 2016

Double top

Let's play darts

I can definitely understand why people who don't play sports like snooker or darts view them more as games or pastimes than genuine sports. 

It's true that in British pub culture that there are certain man skills that are de rigeur: being able to flip beer mats, using nudge and hold to secure the fruit machine features, and, particularly important, being able to clear an 8-ball ball pool table from the break.

These are all things that a regular at the local can master over 52 successive Saturdays at the boozer.

Yet to play snooker or darts at the top level requires true mastery and years of obsessive practice.  

As a Sheffielder I used to love watching the early knockout rounds of the snooker World Championship at The Crucible Theatre - the only rounds I could afford to attend as a student, of course! - when you could watch world champions defeating minnows with ease up close.

Still the most amazing display of skill I've seen in the flesh was Ronnie O'Sullivan's maximum break of 147 (15 reds, 15 blacks, plus all the colours in order) in a record 5 minutes and 20 seconds at the World Championships in Sheffield in 1997, a clearance that has not been bettered to this day and perhaps technically the best frame of snooker every played. Pure poetry in motion! 

The darts equivalent of a 147 break is the hallowed nine-dart finish. The mathematicians among you will calculate that there are some 3944 possible pathways or permutations of how you can check out 501 in nine darts (the rules of darts state that you must finish with a double or with the bullseye, for which 50 points are awarded). 

In local pub matches and in some Grand Prix competitions the rules state that you must commence and complete your scoring, known as "double-to-start" or "double in, double out". 

If you're lucky enough to hit a double top with your first dart you can still complete a nine-darter, provided that you can nail at least seven trebles or bullseyes in a row. Here are two example finishes:

In 2011, Northern Irishman Brendan Dolan became the first darts player in history to shoot a nine-dart finish "double in, double out" at a packed out Grand Prix event in Dublin, having started with a double top.

Now just imagine the winnings he could take if he could pull that one out as a hustling trick in the local boozer! 

Double top

For share traders the 'double top' has a different meaning, whereby a security hits a new high during an upward trend before meeting resistance and selling off to a support level. 

The security then has a second failed attempt at breaking through the resistance before retreating to the support level, which, if it is broken on the downside, completes the double top pattern.

It's vitally important for traders to note that the second test does not always have to reach the same level as the first.  

It's also crucial for traders to note that if the support level is broken and a trend reversal occurs, then,'d better execute that stop! 

For various reasons the double top and double bottom patterns are two of the most common chart formations familiar to traders. 

The chart is effectively a battle between buyers and sellers, and when an uptrend fails with a double top formation occurring, buyers either lose interest or become exhausted, causing the price to eventually fall. 

Construction cycle peaks

While technical analysis doesn't always translate well into other economic data, you can't help but notice the quite beautifully formed double top patterns in the building approvals figures, which are now breaking out on the downside to form a trend reversal. 

The October housing finance figures also showed that loans being written for owner-occupied new dwellings are failing to test the resistance level.

Remember the second top does not need to be as high as the first, and as such domestic buyers of new dwellings in this cycle are getting close to becoming exhausted. 

It's easy to see why the peak was called early by market commentary in this cycle with regards to building approvals and the construction cycle, essentially because there was a double top pattern. It looked as though the peak was in, but a couple of interest rate cuts gave the market a second wind.

Now the inevitable downturn in construction will, of course, be led by inner city apartment blocks. 

Look out below!


Dolan makes history with a nine-dart finish including a double top start.