Triple Bottom - Chart Pattern
Triple Bottom Chart Pattern
Triple Bottom is a chart pattern with three bottoms very close in price. This pattern can be seen in all time-frames. There are a few requirements to classify a chart pattern as a triple bottom:
- Price lows are close to each other
- Equal distance in time between lows
- Volume decreases on each successive bottom
Triple bottoms have an enormous amount of cause or breakout potential as the price of the stock has moved back in forth within a defined range. So, when the stock finally breaks out, there is an expansion in volume and price movement. Breakouts can occur to both the upside and downside. If you enter a breakout of a triple bottom chart pattern, you will want to keep a close stop above/below the support/resistance level.
When a stock breaks out of a triple bottom formation, the price target is the range of the formation added to the breakout level.