How to Oil Trade a Double Bottoms Crude Oil Trading Chart Pattern in Oil

How to Trade the Double Bottoms Crude Oil Trading Chart Pattern

To learn how to analyze the oil market using double bottoms oil chart patterns a oil trader should first of all learn the technical analysis of double bottoms oil chart pattern explained in this tutorial.

Double Bottoms Oil Pattern

Double bottoms oil pattern is a reversal oil pattern that forms after an extended downward crude oil trend.

Double bottoms oil pattern is made up of 2 consecutive troughs that are roughly equal, with a moderate peak that is between the two troughs.

Double bottoms oil chart patterns formation is considered complete once crude crude oil price makes the second low and then penetrates the highest point between the lows, called the neckline.

The buy oil signal from this double bottoms market bottoming out oil signal occurs when the oil market breaks-out the neckline to the upside.

In Oil, the double bottoms oil chart pattern is an early warning oil signal that the bearish oil trend is about to reverse.

Double Bottoms Crude Oil Trading Chart Pattern is only considered complete/confirmed once the neckline is broken. In this double bottoms oil chart patterns formation the neckline is the resistance level for the crude crude oil price. Once this resistance is broken the oil market will move up.

Summary:

• Double bottoms oil pattern forms after an extended move downwards - oil downward trend
• This Double bottoms oil pattern formation indicates that there will be a reversal in crude oil trading market
• We buy when crude crude oil price breaks-out above neckline: as described on the oil example shown below.

Oil Trade a Double Bottoms Crude Oil Trading Chart Pattern in Oil?

The double bottoms oil chart pattern look like a W Shape oil chart pattern, the best reversal oil trading signal is where second bottom is higher than the first bottom as illustrated below.

This means that the reversal oil signal from the double bottom oil chart pattern can be confirmed by drawing an upward oil trend line as shown below. If a oil trader opens a buy oil signal the stop loss will be placed just below this upward oil trend line.

How to Trade the Double Bottoms Crude Oil Trading Chart Pattern – How Do You Analyze a Double Bottoms Crude Oil Trading Chart Patterns