Just another name for a double bottom.
Double bottoms are strong reversal patterns...Naming the components of the pattern is just for fun although you can't really ID the pattern until you see support holding at the "dragon's front feet".
Being that I define a 2B Dragon as a trend reversal pattern, in order to identify and validate it there has to be a trend to reverse ...That is, there must be a "tail" on the upper left hand side of the chart where prices have trended down from, relative to current prices.
Next you should see two distinct areas where prices refused to go lower...These lows represent the transitional area between trends - from sets of lower highs & lower lows to sets of HH's & HL's...These become the dragon's front and rear "feet" and they indicate that recent downward P/A is in the process of changing...the feet are either developing a new support level or are re-discovering an earlier support level.
The dragon's back or "hump" prints between the two sets of "legs" and will usually become the first higher high of the new upward trend (provided of course that the legs prove to be support).
A price consolidation area, or a "head" should develop shortly after the two support legs have formed...Sans the head, the pattern is 'just' a double bottom...But with or without the head, it's a pattern that traders should be aware of...
2Bs and Dragons happen frequently, on very short or long term time frames and they lead to powerful drives that can be taken advantage of when spotted early.
Divergence at the dragon's Rear-feet suggested a possible end to the down trend was imminent. The 2x divergence (TRIX histo and MACD) at the dragon's Front-feet said BUY...this had to do some work to break free of the level around the dragon's HUMP (over/under resistance) but the Reverse-Divergence there was encouraging.
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3/12/2013 False Flags
Trades don't always work out...The picture below shows an entry I took using 3xD and a 2B dragon pattern as the trade rational. I entered using a Limit+TTO at the Hump, after it broke that level and retraced..
In retrospect, it wasn't a good trade to take in the first place - the low at the front feet was actually higher than the low at the rear feet, thus both entry reasons were wrong. There wasn't divergence and the Dragon never completely landed on the ground...
This is why I always use stops - to minimize the damage done by my sloppy chart reading, by uncooperative markets and by failed entry rational.
Below is another example that shows when an initial false rational can 'snowball' into further false flags - leading to a poor trade result.
Using multiple time frames for perspective...plenty of patterns on each.