W-Pattern Trading: The Double Bottom Strategy That Works
Master the W-pattern (double bottom) reversal strategy. How to spot them early and maximize your entries.
The W-Pattern Anatomy
The W-pattern forms when price tests support twice and then breaks out above resistance
📊 What is a W-Pattern?
The W-pattern, also known as a double bottom, is one of the most reliable reversal patterns in technical analysis. It forms when an asset's price tests a support level twice, creating a distinctive "W" shape on the chart.
This pattern signals that selling pressure is exhausted and buyers are stepping in. When price breaks above the "neckline" (the high point between the two bottoms), it often triggers a significant upward move.
📈 Success Rate: According to Bulkowski's research, the double bottom pattern has a 78% success rate when traded correctly. Wallet Bot's AI detection helps you find the best setups.
🎯 Key Characteristics of a Valid W-Pattern
Not every price bounce is a valid W-pattern. Here's what to look for:
1. Similar Lows
Both bottoms should be at approximately the same price level (within 3-5%)
2. Time Between Bottoms
Ideally 1-6 weeks apart in traditional markets, 1-7 days in crypto
3. Volume Pattern
Higher volume on second bottom and breakout confirms buyer strength
4. Clear Neckline
A defined resistance level between the two bottoms
⚡ How to Trade the W-Pattern
Entry Strategy
- 1Wait for Confirmation
Don't buy at the second bottom hoping for a pattern. Wait for price to break above the neckline.
- 2Enter on Breakout or Retest
Aggressive: Buy on breakout. Conservative: Wait for a retest of the neckline as support.
- 3Set Your Stop Loss
Place stop loss just below the second bottom (typically 5-10% below your entry).
Profit Target Calculation
The measured move target is calculated by measuring the distance from the bottoms to the neckline, then projecting that same distance above the breakout point.
Target = Breakout Price + (Neckline - Bottom Price)
Example: If bottom = $0.50, neckline = $0.75, then target = $0.75 + $0.25 = $1.00
🤖 Using Wallet Bot's AI Pattern Detection
Manually scanning charts for W-patterns is time-consuming and error-prone. Wallet Bot's AI-powered pattern detection does the heavy lifting for you:
- ✓Real-Time Scanning: Continuously monitors all Solana tokens for forming patterns
- ✓Quality Scoring: Rates pattern strength from 1-100 based on multiple factors
- ✓Instant Alerts: Get Telegram notifications when high-quality patterns form
- ✓Auto-Trading: Configure automatic buys when patterns meet your criteria
🚫 Common W-Pattern Trading Mistakes
❌ Entering Too Early
Don't assume every double dip is a W-pattern. Wait for the neckline break.
❌ Ignoring Volume
Low volume breakouts often fail. Look for increasing volume on the breakout candle.
❌ No Stop Loss
Patterns fail. Always protect your capital with a stop loss below the second bottom.
❌ Fighting the Trend
W-patterns work best after established downtrends. In strong uptrends, use other patterns.
Let AI Find W-Patterns For You
Wallet Bot's AI pattern detection scans thousands of Solana tokens in real-time. Get alerts when high-probability W-patterns form.
Start Pattern Detection