#Educational Double bottom

A double bottom chart pattern indicates a period of selling, causing an asset’s price to drop below a level of support. It will then rise to a level of resistance, before dropping again.

Finally, the trend will reverse and begin an upward motion as the market becomes more bullish. A double bottom is a bullish reversal pattern, because it signifies the end of a downtrend and a shift towards an uptrend.

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When a double top or double bottom chart pattern appears, a trend reversal has begun.Let’s learn how to identify these chart patterns and trade them.Double TopA double top is a reversal pattern that is formed after there is an extended move up. The “tops” are peaks that are formed when the price hits a certain level that can’t be broken.After hitting this level, the price will bounce off it slightly, but then return back to test the level again. If the price bounces off of that level again, then you have a DOUBLE top!This is a strong sign that a reversal is going to occur because it is telling us that the buying pressure is just about finished.With the double top, we would place our entry order below the neckline because we are anticipating a reversal of the uptrend.Wow! We must be psychic or something because we always seem to be right!Looking at the chart you can see that the price breaks the neckline and makes a nice move down.DOUBLE BOTTOMThe double bottom is also a trend reversal formation, but this time we are looking to go long instead of short.These formations occur after extended downtrends when two valleys or “bottoms” have been formed.You can see from the chart above that after the previous downtrend, the price formed two valleys because it wasn’t able to go below a certain level.Notice how the second bottom wasn’t able to significantly break the first bottom.This is a sign that the selling pressure is about finished, and that a reversal is about to occurWill you look at that!#BTC #doublebottom #binanacesquare