Double Bottoms, Eve & Adam

Core idea

An Eve & Adam double bottom is a twin-bottom reversal where the left bottom is wide and rounded (Eve) and the right bottom is narrow and V-shaped (Adam) — often a one- or two-day downward price spike. The pattern confirms (becomes valid) only when price closes above the highest peak between the two bottoms; before confirmation it's just two valleys at similar prices, which fails 48% of the time.

Of the four Adam/Eve combinations (Adam & Adam, Adam & Eve, Eve & Adam, Eve & Eve), Eve & Adam is the rarest. It's a mid-list performer with a 12% breakeven failure rate — meaning 88% of confirmed patterns rise more than 5% after the breakout. The average rise is ~37%, and ~7 months to reach the ultimate high.

Why the shape labels matter

Eve and Adam bottoms behave differently because they encode different microstructure. Eve is wide and rounded with many short spikes — a long, gentle accumulation as buyers and sellers struggle for control. Adam is narrow and V-shaped with one or two long spikes — a panic flush followed by an instant reversal. The four combinations have measurably different statistics, and naming the shape is the first step toward picking the right tactic.

Why it matters

Double bottoms are the workhorse bullish-reversal pattern and one of the few Bulkowski actively trades. The Eve & Adam variant is worth knowing because it's commonly misidentified — traders see the Adam V-spike and think "Adam & Adam," ignoring the wide rounded turn on the left. Getting the classification right matters because the other Adam-family patterns have different failure rates and post-breakout behavior.

The topic also illustrates a broader rule: confirmation is everything. A twin valley that looks like a double bottom but never closes above the intervening peak is just a wider downtrend in progress. Wait for the close, and your failure rate falls from 48% to 12%.

Key takeaways

Mental model

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Practical application

Identification

Trading the confirmation

Example

A mid-cap chip stock falls from $80 to $44 over four months on a sector pullback. In late September, price prints a wide rounded turn between $44 and $48 over six weeks — a textbook Eve bottom — before rallying to $56 in early November. Volume on the rally surges.

In late November, price falls back to $44.50, then plunges to $43.20 on a single day (downward spike), and snaps back to $48 the next day — a textbook Adam bottom. The bottom-low variation: ($44.00 - $43.20)/$44 = 1.8%. Acceptable.

The confirmation price is the November high at $56. You scan the historical chart: there's a cluster of tops in April-May at $58-$60. Resistance overhead. You decide to half-size the trade.

In mid-December, price closes at $56.40. The next open is $56.85; you buy 100 shares with a stop at $42.50 (just below the Adam low). On day 6, price retraces from $58 to $56.20 — the textbook throwback. You hold; the stop is well below. On day 11, price resumes upward and closes at $59.

Three weeks later, price hits the measure-rule target ($56 + ($56-$44) = $68) and stalls right under the May high of $60. You take half off at $59.50 (just under resistance) and trail the rest with a 10% stop. The remainder gets stopped out two months later at $63 — a 12% gain on the trailed portion. Average gain on the trade: ~10%.

If you'd ignored the overhead resistance and sized the trade full, the $60 stall would have felt like a near-miss; with half-sizing, it's a sensible book.

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