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AI Analyst
Connect your own ChatGPT to ask questions about your trades, journal and backtests. Only your data, and read-only unless you let it add and edit trades when you connect (e.g. from a screenshot of your platform).
Two failed attempts at the same price, then a break of the middle: a reversal pattern.
Illustration, not real market data.
What it is
A double bottom ('W') forms when price falls to a low, bounces, falls back to about the same low and holds, then rallies through the high in between (the neckline). A double top ('M') is the bearish version.
How to spot it
Two lows (or highs) at roughly the same price, with a clear bounce between them.
It is only confirmed once price closes through the neckline.
How to use it
Enter on the neckline break or its retest; stop below the second low.
A common target is the height of the pattern projected from the neckline.
Common mistakes
Calling it before the neckline breaks.
Forgetting that the second low often sweeps the first slightly before reversing (see Liquidity).
