What it is
The Triple Bottom is a major bullish reversal chart pattern that resembles the letter "W". It forms when price makes two consecutive lows at approximately the same level, with a moderate peak (the "neckline") in between.
The pattern signals that sellers attempted to push price lower twice but failed both times at the same support level. This double rejection shows that buyers are stepping in at that level, and a breakout above the neckline confirms the reversal.
The psychology
The Triple Bottom represents a dramatic shift in market psychology. After a downtrend, price reaches a low where buyers step in - this creates the first bottom. The subsequent rally fails at resistance (the neckline), and sellers push price back down.
Here's where it gets interesting: price returns to the same support level, but this time the selling pressure is weaker. Buyers who missed the first bounce are now waiting. When price fails to make a new low, it signals seller exhaustion.
The breakout above the neckline is the *moment of truth*. Shorts cover their positions, sidelined bulls jump in, and the previous resistance now becomes support. This combination creates the powerful move that typically follows a confirmed Triple Bottom.
Identification
- 01Prior downtrend - Pattern must form after a meaningful decline
- 02Two distinct bottoms - Lows at approximately the same price level (within 3-5%)
- 03Clear neckline - Identifiable swing high between the two bottoms
- 04Neckline breakout - Price closes above the neckline with conviction
- 01Volume pattern - Higher volume on breakout, lower on second bottom
- 02Adequate time - Bottoms separated by weeks/months (not days)
- 03Second bottom higher - Slightly higher low shows buyer strength
- 04Bullish divergence - RSI/MACD divergence at second bottom
- 01No prior downtrend - Pattern in uptrend is continuation, not reversal
- 02Bottoms too close - Less than 2-3 weeks apart weakens pattern
- 03Second bottom much lower - Breaking first low invalidates pattern
- 04Low volume breakout - Weak volume suggests false breakout risk
Execution framework
Conservative: Enter on a close above the neckline with volume confirmation.
Aggressive: Enter on the retest of the neckline as support after initial breakout.
Place stop below the lower of the two bottoms. This is where the pattern is completely invalidated - if price makes a new low, the triple bottom failed.
Measured Move: Project the height of the pattern (neckline to bottoms) upward from the breakout point. Alternative: Use prior resistance levels and Fibonacci extensions.
Double bottoms typically offer 1:2 to 1:3 R:R based on the measured move target.
Context matters
The Triple Bottom is a rare but powerful reversal pattern. Its three tests of support demonstrate that sellers have repeatedly failed to break a level, and each failure makes the eventual breakout more significant. However, because it takes so long to form, patience and proper confirmation are essential.
- 01When all three troughs test approximately the same price level
- 02After a significant prior downtrend (not a minor pullback)
- 03Volume declines on each successive test of support
- 04Breakout above the resistance line occurs on a clear volume spike
- 05Pattern takes weeks to months to develop (more time = more significance)
- 06Bullish divergence builds across the three troughs on RSI or MACD
- 01When the three troughs are at significantly different levels
- 02In a dominant bear market where support breaks are common
- 03If volume increases on the third test (suggests support is weakening)
- 04Pattern forms too quickly (days instead of weeks)
- 05When the bounces between troughs are shallow with no clear resistance line
- 06If the breakdown below support occurs instead of the expected breakout
More rare than double bottoms, but more reliable. Three bounces off support creates a very clear level for stop placement.
Compare the full pattern set
Use the library to compare similar structures before deciding what the chart is actually building.