Tuesday, June 18, 2024

Triple Bottom

A Triple Bottom is a chart pattern consisting of three equal lows followed by a break above resistance.

The

chart pattern is classified as a Bullish Reversal Pattern.

All three highs should be fairly equal, well spaced, and mark clear turning points to establish support.

The lowest points don’t all have to be at the exact same level, but they should be “close enough”.

That said, patterns with the last bottom higher than the middle usually provide better results.

Triple Bottom

The

Triple Bottom pattern is similar in appearance to the Inverse Head and Shoulders pattern in that it is represented by a series of three highs and lows.

The difference is that all three highs of a triple bottom are at the same height, whereas in a head and shoulders bottom pattern the second low is lower than the first and third highs .

The occurrence of the

triple bottom indicates that has a downtrend and is currently reversing into an uptrend.

Sales pressure is declining, so the downtrend is losing steam.

As with triple tops, it is generally accepted that the longer a particular trend takes to fully develop, the stronger the significant price movement will be once a breakdown occurs.

Triple tops and bottoms are considered one of the slowest chart pattern types to fully mature.

When a triple bottom is forming, it can look like other chart patterns.

For example, the pattern may look like a double bottom before the third high pattern.

Three equal high points can also be found in a descending triangle or rectangle.

For a triple bottom, support can be identified by drawing a line at the bottom of the high, which forms the “neckline“.

Once the price level rises to this resistance level , you may choose to open a long position.

The

triple top should also be considered a neutral chart pattern until the breakout occurs.

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