Cup and Handle: #AskGyani with Nooresh Merani

Cup and Handle: #AskGyani with Nooresh Merani
Cups: Cup-with-Handle

A cup and handle price pattern on bar charts is a technical indicator that 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.

90% of the people in the stock market, professionals and amateurs alike, simply haven’t done enough homework.
William J. O’Neil
William J. O’Neil
"Trade Gyani"

Key Takeaways

Courtesy: Ashish Ahuja

  • To observe the Cup and Handle pattern look for a minimum of 3 tops.
  • The stock to qualify as C&H should have a minimum of 3 months trading range
  • C&H observed at a longer time frame, better the probability. 
  • Flatter the better (Tops should be near to each other) 
  • At or before the breakout volume confirmation increases the probability 
  • Don’t be obsessed with the targets of the cup or handle
  • C&H formed near all time highs are best and have higher probability
  • C&H formed against the trend, say primary trend is downward, then stick to your targets and move on.
  • C&H formed near the all-time highs are reliable and one should ride the trend as long as higher highs and higher lows are being formed.
  •  I believe this is a very reliable pattern, one should use this for investment bets Nooresh showed this with examples like Bajaj Finance and Avanti Feeds

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