The "cup and handle" is a bullish technical analysis pattern used in trading to identify potential upward movements in the price of an asset. Here’s a breakdown of the pattern:
Cup
Formation: The "cup" part of the pattern resembles a U-shape. It forms as the asset’s price experiences a rounded bottom after a decline.
Characteristics:
Decline: The left side of the cup represents a drop in price.
Bottom: The bottom of the cup is typically rounded, indicating a gradual shift from sellers to buyers.
Rise: The right side of the cup shows the price rising back up, approaching the previous high.
Handle
Formation: After the cup formation, the price typically consolidates in a small, downward-sloping channel or sideways movement, forming the "handle."
Cup
Formation: The "cup" part of the pattern resembles a U-shape. It forms as the asset’s price experiences a rounded bottom after a decline.
Characteristics:
Decline: The left side of the cup represents a drop in price.
Bottom: The bottom of the cup is typically rounded, indicating a gradual shift from sellers to buyers.
Rise: The right side of the cup shows the price rising back up, approaching the previous high.
Handle
Formation: After the cup formation, the price typically consolidates in a small, downward-sloping channel or sideways movement, forming the "handle."
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.
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.