Is a Double Bottom Oil Chart Pattern Bullish or Bearish?

A double bottoms crude oil chart pattern has a W shape and it occurs at a market bottom hence its name double bottom crude oil chart pattern and it signals a bullish crude oil price reversal in the oil market.

Once a double bottom crude oil chart pattern is confirmed then the crude oil market will be considered to be bullish, therefore a double bottoms is bullish.

Double Bottom Crude Oil Trading Chart Pattern

Double bottom crude oil pattern is a reversal oil trading pattern that is formed after an extended downward oil trend. Double bottom crude oil pattern is made up of two consecutive troughs that are roughly equal, with a moderate peak between.

This double bottoms crude oil pattern formation is considered complete once crude oil price makes the second low & then penetrates the highest point between the lows, known as the neck line. The buy indication from this bottoming out signal occurs when crude oil market breaks-out the neck line to the upside.

In Oil Trading, this double bottoms crude oil pattern formation is an early warning signal that the bearish Oil Trading trend is about to reverse. It is only considered complete/confirmed once the neckline is broken. In this double bottoms crude oil chart pattern formation the neckline is the resistance level for the oil price. Once this resistance is broken the crude oil market will move up.

Summary:

• Double bottoms crude oil trading pattern forms after an extended move downward
• This Double bottom crude oil chart pattern formation indicates that there will be a reversal in crude oil market
• We buy when oil trading price breaks out above the neck-line: see below for an explanation.

Is a Double Bottom Oil Pattern Bullish or Bearish?