Double bottom


Also found in: Acronyms, Encyclopedia, Wikipedia.

Double bottom

A term used in technical analysis to refer to the drop of a stock's price, a rebound, and then a drop back to the same level as the original drop. The pattern looks like the letter W. In technical analysis, this pattern is considered a positive for the stock. The stock has bottomed out and the technical analysts would expect the stock to appreciate afterwards.

Double Bottom

In technical analysis, a situation in which the price of a security hits a low, rises 10-20%, and then hits roughly the same low before rising again. A double bottom in a relatively short period of time indicates that the low is a price support for the security. A situation where trading volume rises as the security increases from the second bottom is thought to be a bullish indicator. See also: W-shaped recovery.

double bottom

click for a larger image
double bottom
In technical analysis, a chart formation indicating stock price recoverability over time. It is characterized by a drop in a stock's price to a low level, a recovery in price, and a second decline to the previous low price. If the stock price recovers a second time, the low price reached at the two bottoms becomes a level of support for the stock. It is a bearish sign if the stock subsequently falls through this level. Compare double top.

Double bottom.

Double bottom is a term that technical analysts use to describe a stock price pattern that, when depicted on a chart, shows two drops to the same dollar amount separated by a rebound.

For example, if a stock that had been trading at about $28 a share dropped to $18, rebounded to trade at about $22 for several weeks, and then dropped to $18 again, analysts would identify $18 as a double bottom.

An analyst observing this pattern might conclude that investors were comfortable paying $18 for the stock, and that the price might not drop below that level in the near term. In technical terms, the analyst would say that there was support for the price. However, there's no guarantee that it might not drop further and hit a new low.

References in periodicals archive ?
The oil companies and shipping companies did not want SBT or double bottoms to supplant LOT.
Community Based Investing Conference: Best Practices for Double Bottom Line Results is co-hosted by Economic Innovation International and Portland Family of Funds A Community Investment Bank and co-sponsored by Phoenix Realty Group.
DBL Investors is a pioneer of double bottom line venture capital, a new and growing field of investing that seeks to optimize both financial return (First Bottom Line) and positive social impact, including environmental and regional economic benefits (Second Bottom Line).
lt;strong>Trading the pattern: </strong>The confirmation level in a double bottom is the price at the peak of the two troughs.
With the recent $140 million closing of our Fund II (backed by a mix of institutional investors such as pension funds, foundation investors, family offices, and banks receiving Community Reinvestment Act credits)we are continuing to strengthen the DBL team with technical and investment talent, and the ability to provide extra resources to our portfolio companies as they pursue their double bottom line strategy," said Cynthia Ringo, Managing Partner DBL Investors.
Currently, ten ships in Mobil's fleet have double bottoms.
The Northwest Louisiana Community Development Fund I is a part of a rapidly growing $20 billion national Double Bottom Line industry, and is the first of its kind in the South and in a smaller market economy.
Invitation to tender : Supply and installation of SOS alarm cabinets: SOS alarm box tunnel and pre-zone fully equipped double bottom in SOS niche Incl.
Calvert screens its investments with a double bottom line in mind -- looking for companies with strong financial potential, and choosing those whose policies and actions demonstrate responsibility to their employees, to the communities in which they operate and to their customers.
The further evolution of this design extends the protection of a double bottom up the sides of the vessel, providing two steel barriers between cargo and the marine environment.
Together Jose, Lisa and Jared will build our capacity to meet our double bottom line: achieving significant financial returns while making a positive impact on the urban communities in which we invest," said Bobby Turner, CJUF's Managing Partner.
Through this project, the new institution is expected to bring international sound practices tailored to the Myanmar context and generate market demonstration effect for a balanced double bottom line approach with a social focus while being commercially sustainable.