How Do I Analyze Double Bottoms Reversal Chart Pattern?

How Do You Trade Double Bottoms Chart Pattern Reversal Pattern?

Double Bottoms Reversal Strategy

Double bottoms downward Trend Reversal strategy is a reversal setup which forms after an extended downwards trend. Double bottoms downward Trend Reversal strategy is made up of 2 consecutive troughs which are roughly equal, with a slight peak in between.

Double bottoms downward Trend Reversal strategy formation is considered complete once price makes second low and then penetrates the highest point between the lows, called the neck-line. The buy indication from this bottoming out signal occurs when market breaks-out the neck line to the upside.

In Forex, Double bottoms downward Trend Reversal strategy formation is an early warning signal that the bearish trend is about to reverse.

Double bottoms downward Trend Reversal strategy is only considered confirmed once the neckline is broken. In this Double bottoms downward Trend Reversal strategy formation the neck-line is resistance level for price. Once this resistance is broken the market will move upward.

Summary:

• Double bottoms downward Trend Reversal strategy forms after an extended move downward
• This Double bottoms downward Trend Reversal strategy formation indicates that there will be a reversal in trend
• We buy when the price breaks above the neck line point: see below for explanation.

Down Trend Reversal Strategy

The double bottom reversal pattern looks like a W Shape, the best reversal signal is where the second bottoms is higher than the first one as illustrated below, this means that the reversal signal can be confirmed by drawing an upwards trend line as illustrated below.

Double Bottom Trend Reversal Signal Strategies

How Do I Analyze Double Bottoms Chart Pattern Reversal Chart Pattern?