V-Bottom
BullishReversalIntermediateA crash, then an instant rebound. No base, no waiting.
Verdict: SkipBitcoin 4H: 20 trades, won 40%, avg trade −2.2% vs random day +0.3%. Backtest
Price drops hard and fast. Each little bounce gets sold.
step 1/6
Trade rules
| Direction | Long (buy) |
|---|---|
| Entry | After a fast drop from a swing high (8%+ on Bitcoin, 10%+ on stocks, at least half an average candle range per candle), the first CLOSE above the last small lower high of the drop, coming no slower than the fall from that high to the low (3 candles minimum). |
| Cancelled if | A recovery slower than that, or a new high above where the drop started, cancels it. |
| Target | Back to the top, projected from the breakout |
3 common mistakes
- Buying the first green candle of the crash: that is catching a falling knife.
- Waiting for a base: a V has none, so the signal is a close above the last lower high.
- Slow recoveries: if the bounce takes longer than the fall, it is not a V.
Backtest
same rules every time · equal size · no fees · method| Market | Trades | Won | Avg trade | Random day |
|---|---|---|---|---|
| Bitcoin · 4H · 2017-2026 | 20 | 40% | −2.20% | +0.34% |
| US large caps (50) · 1D · 2016-2026 | 218 | 54% | +0.27% | +1.37% |
Verdict: SkipNever beat a random entry, and lost money in some markets.
pattern −44%random +6.8%
pattern +58%random +298%