Bottom Reversal
Volume Spread Analysis glossary · Effort vs Result & Spread/Close Analysis
Definition
A two-bar reversal pattern at the bottom of a decline. Bar 1 is a wide-spread down-bar on high volume (apparent selling); Bar 2 is a wide-spread up-bar that closes above Bar 1's high, revealing that Bar 1's high volume contained massive hidden professional buying disguised by the downward price action. Strongly bullish: the reversal from apparent weakness to confirmed strength marks a potential major bottom. Distinguished from a general two-bar reversal by its appearance specifically at established lows after an extended decline.
Bottom Reversal in plain English
A Bottom Reversal is a two-bar clue that a long price slide may be ending and big buyers have secretly stepped in. Bar 1 is a wide down-bar on heavy volume that looks like panic selling — but that huge volume actually hides professionals buying up everyone's shares, disguised by the falling price. Bar 2 then shoots up and closes above Bar 1's high, exposing the trick: the "weakness" was really strength. It's like a scary rumor that crashes a stock, only for you to realize the smart money was gladly scooping up bargains the whole time — and it only counts as this pattern when it appears at the exhausted bottom of an extended decline.
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Practice Bottom Reversal
You see a two-bar pattern: Bar 1 is a wide-spread down-bar… What is this descriptive name?
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