Double Bottom (Bullish Pattern)

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The goal of every trader is to make trades in which risk is the lowest and profit potential is the highest. To achieve this goal, you need to find when market or security is in an extreme bottom or top. In this stock as you can see from the chart, price printed YTD high in March this year at and around $93.33 after serial of higher highs and higher lows. The price gave up almost 63% from March high, and tried to rebound from May low this year at and around 36.11 but that rebound did not work, and price retraced back to May low in August along with the market. Now price seems ready to breakout upside from this double bottom in 3-month formation. The price seems to have reached a bottom after failing to break through a support level and ultimately rising higher in a sign of reversal to a new uptrend. The Double Bottom pattern forms during a downtrend as the price reaches two distinct lows at roughly the same price level. Volume reflects a weakening of the downward pressure, tending to diminish as the pattern forms, with some pickup at each low, less on the second low. Finally the price breaks upward above the highest high to confirm the bullish signal. If you are interested in getting real time alerts visit www.2waytrading.com now open for a new clients with limited space.

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