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A long-term bullish reversal pattern shaped like a bowl or saucer. The gradual curve represents a slow, steady shift from selling pressure to buying pressure.
The Rounding Bottom (also called Saucer Bottom) is a long-term bullish reversal pattern that forms after an extended downtrend. The pattern resembles a bowl or saucer shape, with price gradually curving from decline to consolidation to advance.
This is one of the most reliable reversal patterns because it represents a genuine shift in market sentiment - not a sudden reversal, but a gradual transition from distribution to accumulation. The pattern typically takes weeks to months to form completely.
The rounding bottom tells a story of gradual sentiment change. On the left side, sellers are in control but losing momentum. Each decline is shallower than the last. The selling pressure is exhausting itself.
At the bottom of the curve, the market reaches *equilibrium*. Neither buyers nor sellers have conviction. Price drifts sideways with low volume. This is the accumulation zone where smart money quietly builds positions.
On the right side, buying pressure gradually increases. Each rally is stronger than the last. Volume expands as more participants recognize the trend change. The breakout above the neckline confirms the reversal is complete.
Conservative: Buy on confirmed breakout above neckline with volume.
Aggressive: Buy during right side of curve as price rises with volume.
Below the bottom of the rounding formation, or below recent swing low for tighter stops.
Measured Move: Depth of pattern projected upward from breakout point.
Often 1:3 or better due to long-term nature and significant measured moves.
Also called a saucer bottom. The longer it takes to form, the more significant the eventual rally tends to be.
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