What is a bearish cup & handle pattern?

The bearish Cup and Handle pattern forms in a downtrend and is traded as a bearish breakdown signal. So, you can use it to go short on the market if you want. This is how you trade the pattern: You have a sell signal when the price breaks below the lower trend line of the price channel that forms the handle.

What is the cup & handle pattern?

One of the most important chart patterns in the stock market is the Cup and Handle Pattern, invented by William O’Neill. Sometimes you might see it abbreviated as CWH. It also holds the crowd proclaimed title as one of the most profitable and reliable breakout patterns. The Cup and Handle Pattern forms as a bullish...

What is an 'inverted cup and handle' pattern?

An ‘inverted cup and handle’ is a chart pattern that indicates bearish continuation, triggering a sell signal. Think of it as an upside-down cup and handle. If you look at the regular cup and handle pattern, there is a distinct ‘u’ shape and downward handle, which is followed by a bullish continuation.

Is a cup and handle a continuation or a reversal pattern?

If the bullish cup and handle occurs after a bullish price move, it will be considered a continuation. If the bullish cup and handle occurs after a bearish price move, it will be considered a reversal pattern. This pattern was named cup and handle because it resembles a cup with a handle.