Downtrend double bottom
BullishA falling price tapped the same low twice and turned back up — a reversal spot while that low holds
Patterns are right about half the time. How far they rose and fell matters more than how often they rose.
Textbook shape
How to read it
After a run of lower prices, the market taps the same level twice and turns back up. It bounced off the first low, slid back, and stopped again at almost exactly the same price — a sign that supply stopped coming out below that level.
The same W reads differently depending on where it forms. A W built while price sits well under its average marks a place where the decline stalled; a W inside an ongoing advance is usually just a pause. This signal only marks the first kind.
A clean exit is what this shape is good for: below the second low, the setup is void. From entry to that low is usually about 4%, so a miss costs little while a hit can run several times further.
It is not a signal that is often right. Counting the history, it worked best on US large caps and Bitcoin, and poorly on Korean names and small altcoins. The same shape resolves very differently depending on where it forms.
The W itself has flavors. A second low slightly above the first did best; one that undercut the first did worst — there the exit sits right at that fresh low, so it is easily taken out again. The chart label names which flavor you are looking at.
Real example
US stockSMCIDaily
Completed 2023-11-03
CryptoBTC-USDDaily
Completed 2018-09-11
A window SQMATE's detectors actually flagged in past bars. It records a day that worked out — the same shape doesn't always resolve the same way.
The same setup, twice, on one stock
A double bottom, then a tall candle with no wicks. In 2022 it was stopped in three days; eleven months later the same setup doubled in a month. Here is what differed.
Bitcoin tapped the same low twice
The signal fired five times in 2026. The first three ended at the stop; the last two were the bottom. Here is what was different.
On SQMATE
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You don't have to flip through charts hunting for shapes. Signal watch pings your browser the moment a condition is met, patterns on your watchlist arrive by email, and the screener lists every symbol that matched today.
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Support lines, trendlines, channels — the lines you need to read a pattern are drawn for you, so no time goes into drawing.
Patterns aren't the whole story
The same shape doesn't always resolve the same way. It's safer to read it together with candles, volume, and market context — news, catalysts, flows.
This pattern, on your own charts
Stop flipping through charts looking for Downtrend double bottom
Open a ticker and Downtrend double bottom is already marked — with the channels, support, resistance and trendlines drawn for you, like the chart below. That's the drawing time back, and the day a new one forms you get told.
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