Published: 2026-02-26
Double Bottom Pattern: Trading the W-Shaped Bullish Reversal in Crypto
Double bottom is a W-shaped reversal. Two holds at support — break the middle peak for the measured move up.
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Price drops twice to similar lows and holds both times.
A peak between the lows forms the neckline resistance.
- Two troughs — roughly equal depth
- Peak between — neckline resistance
- W shape on the chart
- Forms after downtrend — reversal context
Bullish Signal
Sellers fail twice to push lower — demand absorbs supply at support.
Neckline break shows buyers regained control.
- Second low on lighter volume — selling exhaustion
- First close above neckline — trigger
- Inverse of double top — same rules flipped
- Spot and perp — same pattern logic
Entry Methods
Conservative — buy close above neckline resistance.
Aggressive — buy retest of neckline as new support.
- Trigger — close above middle peak
- Retest long — entry on hold at neckline
- Stop below second low or retest wick
- Limit buy on retest — maker fee advantage
Measured Move Target
Measure valley low to neckline peak height.
Add that distance above breakout for target.
- Target = neckline plus pattern height
- Scale out at prior resistance zones
- Funding turns positive — longs building
- Net fees from target — realistic profit plan
Valid vs Invalid W
Two lows in a sideways range differ from a true double bottom.
Prior downtrend and volume shift validate the reversal.
- Needs downtrend before pattern — not random chop
- Second low shallower — acceptable variant
- Triple bottom — third hold strengthens
- Unclear W in chop — fees eat edge — wait
Crypto Context
Capitulation wick on second low — common in crypto dumps.
BTC double bottom on daily — risk-on for alts.
- Watch liquidation flush on second trough
- Confirm BTC before alt double-bottom long
- Stop below wick — wide — size down
- Compare venue fees — tight target needs low cost
Quick Summary
Double bottom is a twin-trough bullish reversal with neckline breakout trigger.
Target measured move up, stop below lows, and compare fees before sizing.
- Two equal lows — peak neckline — W shape
- Break neckline — target pattern height up
- Run fee calculator on double-bottom long targets
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