The double bottom reversal pattern is similar to the double top reversal pattern, but it goes in the opposite direction.
What Is the Double Bottom Reversal Pattern?
- It’s a reversal pattern or bullish pattern
- Begins with a downward pattern and typically ends with an upward pattern
- There can be double tops or triple tops between the double bottom
- Double bottoms take longer to develop than double tops
- Even if there is a double top between the double bottom, it is more important that there is a double bottom because it spans a longer period of time than the double top
How to Trade a Double Bottom Reversal Pattern
- Enter the stock somewhere off the second bottom
- Ideally, you should enter it after it crosses the resistance line (from the two tops that occurred earlier)