Enter the characters you see below Cup and handle, we just need to make sure you’re not a robot. Enter the characters you see below Sorry, we just need to make sure you’re not a robot. Our network of expert financial advisors field questions from our community.
Sophisticated content for financial advisors around investment strategies, industry trends, and advisor education. A celebration of the 100 most influential advisors and their contributions to critical conversations on finance. The latest markets news, real time quotes, financials and more. What is ‘Cup and Handle’ A cup and handle price pattern on bar charts resembles a cup and handle where the cup is in the shape of a “U” and the handle has a slight downward drift. The right-hand side of the pattern typically has low trading volume, and may be as short as seven weeks or as long as 65 weeks.
A cup and handle is considered a bullish continuation pattern and is used to identify buying opportunities. Cup and Handle Characteristics It is worth considering the following when detecting cup and handle patterns: Length – Generally, cups with longer and more “U” shaped bottoms provide a stronger signal. Avoid cups with a sharp “V” bottoms. Depth – Ideally, the cup should not be overly deep. Avoid handles which are overly deep also, as handles should form in the top half of the cup pattern. Trading the Cup and Handle Place a stop buy order slightly above the upper trend line of the handle. Order execution only occurs if the price breaks the pattern’s resistance.