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Double Bottom

The Double Bottom pattern forms when price creates two troughs at approximately the same level. This is a strong bullish reversal pattern signaling the end of a downtrend.

Bottom 1Bottom 2NecklineDouble Bottom: 2 equal bottoms → Break neckline → Rise

Pattern Details

Category

reversal

Success Rate

82%

Average Move

+20%

Duration

2-3 weeks

Pattern Structure

Pattern Structure
Key components that define this chart pattern
  • 1
    First Trough: Price reaches low and rises
  • 2
    Peak: Temporary resistance level
  • 3
    Second Trough: Price returns to previous low level and rises

Trading Rules

Trading Rules
Essential rules for trading this pattern successfully
  • ✓
    Enter long position when price breaks above peak
  • ✓
    Volume should increase on breakout
  • ✓
    Target = Distance from trough to peak
  • ✓
    Stop loss placed below second trough
Trading Tips
  • Two troughs should be at least 10 sessions apart
  • Increasing volume at second trough is positive
  • RSI divergence increases reliability

Statistics

Breakout Statistics
Bullish Breakout82%
Bearish Breakout0%
Performance Metrics
Average Rise+20%
Average Decline-0%
Pullback Rate11%