Technical Analysis: USD/JPY – Double Bottom Reversal Formation
Pair: USD/JPY
Timeframe: 30-Minute (M30)
Date: May 7, 2025
Pattern: Double Bottom – Bullish Reversal Pattern
📈 Market Structure Overview
The USD/JPY pair has recently shifted from a short-term downtrend into a potential bullish reversal phase, evidenced by the appearance of a double bottom structure at a significant support level.
🟩 1. Pattern Recognition – Double Bottom
First Bottom (Bottom 1): Price declines sharply and finds support at the 141.89 level. Buyers begin to enter the market.
Pullback: Price retraces upward, testing a minor resistance zone but fails to sustain above it.
Second Bottom (Bottom 2): Price returns to retest the 141.89 support, but this time with reduced bearish momentum, showing signs of seller exhaustion.
Support Holds: The support zone holds firmly, and buyers push price higher again, confirming the "W"-shaped reversal pattern.
📏 2. Neckline Breakout
The neckline resistance was formed at 143.677, acting as a confirmation trigger level.
After the second bottom, the price breaks above this neckline on strong bullish momentum, confirming the double bottom pattern.
🔁 3. Retest & Bullish Continuation
After breaking the neckline, price pulls back slightly toward the neckline zone.
This retest of the neckline (previous resistance turned into support) is a textbook bullish confirmation.
Buyers re-enter at this level, and price resumes upward momentum.
🎯 4. Trade Setup
Component Level
Entry After breakout & retest above 143.00
Take Profit 144.201 (based on measured move and recent resistance zone)
Stop Loss 141.890 (below double bottom support)
Rationale:
Target level aligns with recent swing highs and expected measured move from the bottom to neckline.
SL placed safely below structure to reduce risk of false breakouts.
Risk-to-Reward Ratio: Approximately 1:2 (favorable)
🧩 Key Technical Zones
Support Zone: 141.890
Resistance Zone / Target: 144.201
Breakout Zone: 143.677
SL Placement: Below double bottom and consolidation wick support
🔎 Confirmation Factors
Classic double bottom with near-perfect symmetry
Higher low formation
Bullish breakout with strong candles and retest
Resistance flip into support (neckline)
Momentum shift visible on volume and price action
✅ Conclusion
This chart shows a clear bullish reversal opportunity in USD/JPY following a confirmed double bottom pattern. With a break and retest of the neckline, the technicals support a long trade targeting 144.20, while maintaining a well-protected stop below 141.89. The setup reflects a clean structure with strong reward potential and low downside risk.
Pair: USD/JPY
Timeframe: 30-Minute (M30)
Date: May 7, 2025
Pattern: Double Bottom – Bullish Reversal Pattern
📈 Market Structure Overview
The USD/JPY pair has recently shifted from a short-term downtrend into a potential bullish reversal phase, evidenced by the appearance of a double bottom structure at a significant support level.
🟩 1. Pattern Recognition – Double Bottom
First Bottom (Bottom 1): Price declines sharply and finds support at the 141.89 level. Buyers begin to enter the market.
Pullback: Price retraces upward, testing a minor resistance zone but fails to sustain above it.
Second Bottom (Bottom 2): Price returns to retest the 141.89 support, but this time with reduced bearish momentum, showing signs of seller exhaustion.
Support Holds: The support zone holds firmly, and buyers push price higher again, confirming the "W"-shaped reversal pattern.
📏 2. Neckline Breakout
The neckline resistance was formed at 143.677, acting as a confirmation trigger level.
After the second bottom, the price breaks above this neckline on strong bullish momentum, confirming the double bottom pattern.
🔁 3. Retest & Bullish Continuation
After breaking the neckline, price pulls back slightly toward the neckline zone.
This retest of the neckline (previous resistance turned into support) is a textbook bullish confirmation.
Buyers re-enter at this level, and price resumes upward momentum.
🎯 4. Trade Setup
Component Level
Entry After breakout & retest above 143.00
Take Profit 144.201 (based on measured move and recent resistance zone)
Stop Loss 141.890 (below double bottom support)
Rationale:
Target level aligns with recent swing highs and expected measured move from the bottom to neckline.
SL placed safely below structure to reduce risk of false breakouts.
Risk-to-Reward Ratio: Approximately 1:2 (favorable)
🧩 Key Technical Zones
Support Zone: 141.890
Resistance Zone / Target: 144.201
Breakout Zone: 143.677
SL Placement: Below double bottom and consolidation wick support
🔎 Confirmation Factors
Classic double bottom with near-perfect symmetry
Higher low formation
Bullish breakout with strong candles and retest
Resistance flip into support (neckline)
Momentum shift visible on volume and price action
✅ Conclusion
This chart shows a clear bullish reversal opportunity in USD/JPY following a confirmed double bottom pattern. With a break and retest of the neckline, the technicals support a long trade targeting 144.20, while maintaining a well-protected stop below 141.89. The setup reflects a clean structure with strong reward potential and low downside risk.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.