Market initiation generally refers to the situation where, after a long period of sideways consolidation or bottom formation, a gathering of bulls or bears occurs, marking the start of a new round of upward or downward movement. The K-line trend before market initiation often exhibits very regular patterns, with classic examples being the "head and shoulders (bottom/top)" pattern, "double bottom (top)" pattern, "triple bottom (top)" pattern, and "round bottom (top)" pattern. When we observe the K-line trend forming these patterns during the processes of bottom formation, top formation, or sideways consolidation, we should take note, as the market may be about to reinitiate, starting a new round of upward or downward movement.
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The market experienced a bottom formation process before the rise. During this bottom formation process, a very typical bottom reversal K-line pattern appeared— the "double bottom" pattern, which is commonly referred to as the "W bottom" pattern. The prerequisite for the formation of the "double bottom" pattern is that the price has gone through a round of decline, during which two prices appear at a phase bottom, and these two prices are within the same price range. The principle behind the formation of the "double bottom" pattern is that after a round of decline, the price hits a bottom, then rebounds, but after the rebound loses momentum, it declines again, and at the previous low point, it receives support, forming a new low, and then rises again, thus forming the "double bottom" pattern. It is important to note here that the two low points do not necessarily have to be at the same price level, as long as they are relatively close. The two low points in the diagram are not at the same price level; they just need to be within the same price range.
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The "double bottom" pattern is a very typical pattern before market initiation. If we find in actual trading that the market has formed a "double bottom" pattern at a phase bottom, then we should be alert, as the market may begin a new round of upward movement. When the price breaks through the neck line of this "double bottom" pattern, it signals a buying opportunity.