Double bottom pattern
Also called: Double bottom, W pattern, W bottom, İkili dip, Çift dip
A reversal pattern where price makes two lows in the same area and then closes above the peak between them; it shows the decline has found buyers.
4 min read · one puzzle on the page
What is a double bottom?
A double bottom forms at the end of a decline when price drops into the same area twice and gets pushed back both times. Drawn out it looks like the letter W. The peak between the two lows is the neckline.
The story is simple: sellers tried to take price below the first low again and couldn't. Buyers defended the zone the first time and defended it again. Whatever was driving the decline has weakened.
Two lows on their own are not the pattern, though. Until price closes above the neckline after the second low, all you have is a support tested twice. That close is what actually signals the turn.
How do you recognise a double bottom on a chart?
First you need a decline; two lows inside an uptrend are just a pullback. Then two swing lows in the same price zone with a clear bounce between them, say the first at 1.0820 and the second at 1.0826. They don't need to match to the pip.
Watch how price arrives at the second low. Shrinking candles, long lower wicks and closes holding above the level tell you selling is fading. Sometimes the second low wicks a few pips under the first and snaps back; that's a sweep of the stops below the first low, and if the close holds above the level, the pattern is intact.
Confirmation is a close above the neckline. The textbook target projects the distance from the lows to the neckline upward from the breakout. Some traders wait for price to come back and retest the neckline; if old resistance has turned into support, price holds there.
The logical stop sits a little below the second low. A close beneath both lows means buyers no longer defend the zone. Buy at 1.0826 with a stop at 1.0810 and you're risking 16 pips; that distance is your 1R.
Try it on a chart
This chart stops on the second leg of a double bottom: price has come back to the support where it first bounced, and the neckline hasn't broken yet. Look at how the candles close at the level and what their wicks say, then decide where your idea would be proven wrong.
Price came back to a support it bounced from before and held with lower wicks. What's your call?
No sign-up needed. Make your call; when the chart opens you'll see why.
The most common double bottom mistakes
Counting the pattern before it's finished. The moment price touches the second low, people call the W complete, but at that point price has only tested support again. Buying a rejection at support can be a fine idea; just call it what it is and size the risk accordingly.
Seeing a double bottom in any two lows. Two lows three candles apart are a tight pause, and without a real bounce between them there's no neckline.
Jamming the stop just under the first low, where everyone else's sits. The area beneath an obvious double bottom is a stop pool, and price wicking into it before turning is common. Give it some room and cut the size if the distance grows.
Then there's chasing the breakout candle. Buy the top of the big green candle that clears the neckline and your stop is either far away under the lows or resting on nothing. If you missed the break, waiting for the retest is almost always calmer than chasing.
When does a double bottom fail?
In a sharp, young downtrend, two lows are often just a pause. If the higher timeframe trend is down and price is still making lower highs, the W on the small chart usually becomes the start of the next leg down.
A third or fourth visit to the same level weakens it too. Every test uses up some of the buyers there, and the more often price taps the zone, the closer a break gets.
Also look just above the neckline. A strong resistance sitting right there leaves no room for a target even if the breakout comes, so the move may not be worth the risk.
Frequently asked questions
Is a double bottom bullish or bearish?
A double bottom is a bullish reversal pattern. At the end of a decline, price finds buyers twice in the same area, and the turn is confirmed when a candle closes above the peak between the lows, the neckline. Before that break you only have a support tested twice. Its mirror image, the double top, appears after a rally and points lower.
Where do you place the stop on a double bottom?
A little below the second low. If price closes beneath both lows, the idea that buyers are defending the zone is invalid. If you enter on the neckline break the stop ends up much further away, so some traders wait for a retest and place it under the area that held. Since stops cluster just under obvious lows, a small buffer helps.
Which timeframe is a double bottom most reliable on?
Double bottoms on higher timeframes such as the 4-hour and daily are watched by more traders and carry less noise. On a 1-minute chart you'll find a W almost everywhere, and most mean nothing. Even if you trade a small timeframe, checking whether the pattern lines up with a support zone on the bigger chart makes the read much cleaner.
