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When two equivalent bottoms are formed and duration between two bottom points should be one month and volume should be higher in the second bottom or a the breakout point and tends to move in an upward manner, then this qualifies for bullish double bottom. At the breakout point a long position is created by the trader.
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In Double bottom two equal bottom is formed with minimum 30 days time in between them, high volume at second bottom
when price moves past the level of previous top a bullish trend is identified.
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Two equivalent bottoms in the time period of minimum 20 days with the volume higher at the second bottom while it reaches near the previous top.
after a downtrend if two equivalent bottoms are formed, and the stock moves up after hitting the second bottom, then a double bottom indicates a trend reversal on the upside. Volumes should be high during this period.
Double Bottom is the inverse of double top. It is scenario in a stock price movement where two equivalent bottoms are identified with a time gap of at least one month, with a high volume at the second bottom or at the breakout region(while crossing the neckline). The time gap confirms the strength of counter party in the same zone.
Double bottom confirms the Bullish trend and hence it is suitable to create Long position at the breakout place.
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