The Double Bottom ‘W’ continuation Pattern

The double bottom pattern (or ‘W’) is a continuation pattern (not to be confused with the reversal double bottom pattern) that works best in bull markets. This pattern begins with a price advance to new highs (the left top side of the ‘W’ pattern). A sell off ensues which develops into the consolidation phase (the first low) for the stock. The price will then make an attempt at a rally (the middle peak of the ‘W’), which will top out at or before the previous highs of the top left side. There will be one more sell off or shake out of weak holders of the stock resulting in the 2nd low. This phase should make a lower low than the first low. and represents an important psychological turning point for the stock. Weak holders sell out giving the stock the fuel to move higher and break out of the double bottom continuation pattern.

Double Bottom ‘W’ Continuation Pattern Examples

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