Description of triple bottom pattern
Many successful investors keep implementing well known chart patterns such as the “Triple Bottom” in their trading strategies model. Forex traders are not the exception as many traders around the world use formations as the triple bottom to take decisions regarding their trades in the market, including the opening and closing of market positions. The triple bottom chart pattern combined with other market analisys tools allows to discover important trading opportunites to speculate in financial markets like Forex.
Triple bottom chart pattern is also described as TB in short, which is a kind of technical chart analysis examined in the market bottoms. Being the most reliable and trustworthy form of chart pattern, the triple bottom remains outright in its character and it is described by 3 distinct lows within the market having the similar price standards. The triple bottom remains distinct to the head and shoulders chart pattern and the only difference is the 3 lows occurring in the bottom throughout the similar price level existing in the double bottom.
This formation is the opposite of the Triple Top Pattern.
Main features of the Triple Bottom pattern
- The triple bottom pattern occurs when the market is in an downtrend and indicates a possible depletion of the selling momemtum in the market.
- Once complete, this formation implies a bullish corrective phase, which means a change in the trend from bearish to bullish trend.
- It is a formation that can be seen frecuently in the market indicating turnaround phases, so the trader must pay attention to it.
- Like the triple top pattern is quite reliable, meaning that the trader can use this figure as an indication for a possible change in trend. However it should be used carefully in conjuntion with other analysis tools.
The 1st low will occur while the rate increases with a consolidated flow abiding by the market phase trend. Rates will then drop down to the level of the 1st low however the buyers will fall short in gaining the maximum profit to drive up the rates down the support. Moreover, the 3rd low is made in a similar way as done before. The rates generally drop down and go up compared to the early lows but the bottom remains alike the same rate which is quite conventional. The rates will further go up, while the buyers grab their control and the volume rises up again. Triple bottom is set while the rates rise up by means of the early consolidation highs and it would be further infracted on greater volume.
Example of the Triple Bottom pattern