The Double Bottom is a bullish reversal pattern that is formed after the downtrend. Double bottom chart pattern occurs at the bottom of a downtrend.
The double bottom pattern is also known as the W chart pattern.
After this you get to see the reversal in the market.
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Double Bottom Chart Pattern
After the downtrend, you can see a double bottom pattern. In this you will get to see two supports and one resistance.
Both supports can be equal or slightly above or below each other. But will always remain below the resistance.
Let us now know how to make a position in the market with the help of double bottom pattern. When to enter the market, where to put stop loss, what should be our target.
Trade Setup – Double Bottom Pattern
Where do you see the resistance. With the same resistance you have to draw a horizontal line. You can also call this horizontal line as neckline.
As soon as any candle gives a breakout of the neckline. From that on the next candle you can make your position in the market.
The candle that gave the breakout of the neckline. You can place your stop loss below the low of that candle.
If we talk about the target, then all the points are there from the first support to the resistance. You can target the same number of points.
Example 1 – Double Bottom Pattern
You can clearly see the W pattern i.e. double bottom pattern in the example.
Example 2 – Double Bottom Pattern
- Inverted Head and Shoulder Chart Pattern
- Head and Shoulder Chart Pattern
- Bearish Engulfing Candlestick Pattern
- Bullish Engulfing Candlestick Pattern
- Dark Cloud Cover Candlestick Pattern