Is a Double Bottom Chart Pattern Bullish or Bearish?

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

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

Double Bottom Pattern

Double bottoms stocks chart pattern is a reversal stocks pattern which forms after an extended downwards stock trend. Double bottoms stocks pattern is made up of 2 consecutive troughs which are roughly equal, with a moderate peak between.

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

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

Summary:

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

Double Bottom Chart Pattern - Is a Double Bottoms Pattern Bullish or Bearish?