This pattern comprises three rallies, with each succeeding peak higher than its predecessor, and each peak separated by two bottoms, with the second bottom lower than the first. Orthodox broadening formations are associated with market peaks rather than market troughs.

These patterns are extremely difficult to detect until some time after the final top has been formed since there is no clearly definable level of support, the violation of which could serve as a benchmark. The violent and emotional nature of both price and volume swings further compounds the confusion and increases the complexity of defining these situations.

Obviously, a breakout is difficult to pinpoint under such conditions, but if the formation is reasonably symmetrical, a decisive move below the descending trend line joining the two bottoms, or even a decisive move below the second bottom, usually serves as a timely warning that an even greater decline is in store.

Measuring implications are similarly difficult to determine, but normally the volatile character of a broadening top formation implies the completion of a substantial amount of distribution. Consequently, price declines of considerable proportions usually follow the successful completion of such patterns.