Triple Bottom Breakout Scanner
Automated real-time scanner detecting high-conviction Bullish Triple Bottom accumulation bases, multi-month neckline breakouts, and retests across Indian equities.
How to Trade the Triple Bottom Strategy
The Triple Bottom is an elite classical bullish reversal and multi-month accumulation chart pattern. It develops when an asset's price tests a well-defined support zone three consecutive times ($L_1, L_2, L_3$) following an extended corrective downtrend, forming two intermediate peaks ($H_1, H_2$) that establish a horizontal neckline resistance ceiling.
1. Three-Trough Accumulation Geometry
A valid Triple Bottom requires a distinct prior downtrend (≥ 8% to 15%+ decline). Price bounces off support three times (L1, L2, L3) separated by 10 to 40 trading sessions between consecutive pivots. The support level across all three troughs must align tightly (≤ 2.5% divergence or dynamic ATR tolerance), confirming institutional accumulation.
2. Volume Dry-Up & Breakout Expansion
Volume characteristics are critical for distinguishing true bottoms from bear traps. Trading volume should visibly contract during the third trough (L3 volume dry-up), demonstrating seller exhaustion. Upon crossing the neckline, a massive surge in institutional volume (≥ 1.3x 20-day Volume SMA) confirms the breakout.
3. Measured Move Targets & Fibonacci Runners
The primary target equals the vertical height of the 3-trough base projected upward:
Base Height = Neckline - Min(L1, L2, L3)
Target 1 = Neckline + Base Height
Target 2 (Runner) = Neckline + (1.618 × Base Height)
4. Swing Stop vs Structural Base Stop
Tight Swing Stop (Recommended): Placed below the third trough: L3 - 0.20 ATR. This offers an exceptional Risk-Reward ratio (typically 1:2.0 to 1:3.5).
Structural Base Stop: Placed conservatively below the absolute low of the entire formation: Min(L1, L2, L3) - 0.20 ATR.
5. Trade Execution: Aggressive Breakout vs Conservative Retest
Enter on the daily candle close when price closes decisively above the Neckline on ≥ 1.3x 20-day average volume. Ideal for fast runaway momentum stocks.
Wait for price to pull back to retest the broken neckline (former resistance acting as new support) on low volume. Provides an even tighter stop loss and superior R:R.