Cup and Handle Pattern
đ A Cup and Handle is a bullish continuation chart pattern that marks a consolidation period followed by a breakout.
đ Chart patterns form when the price of an asset moves in a way that resembles a common shape, like a rectangle, flag, pennant, head and shoulders, or, like in this example, a cup and handle.
đ The cup forms after a downtrend and is followed by an uptrend and looks like a bowl or rounding bottom.
đ As the cup is completed, the price trades sideways, and a trading range is established on the right-hand side and the handle is formed.
đ A breakout from the handleâs trading range signals a continuation of the previous uptrend.
đ In the case of a Cup and Handle chart pattern, the stop loss should be placed at the previous low of the pattern.
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