Cup & Handle Practice
A cup and handle is a rounded base followed by a small dip — a pause that often resolves higher. Train to recognise the clean "U" and the shallow handle rather than forcing the shape.
A cup and handle is a bullish continuation pattern. Price carves a rounded "U" (the cup), recovers toward the prior highs, then drifts down in a small, controlled pullback (the handle). A breakout above the handle’s high signals the move may resume, with a target often measured from the cup depth.
How to spot it
- ✓ A prior uptrend leads into the pattern.
- ✓ The cup is a smooth, rounded "U" — not a sharp "V".
- ✓ The handle is a small, shallow pullback near the cup’s rim.
- ✓ Volume typically dries up in the handle and expands on the breakout.
- ✓ The signal is a close above the handle high.
⚠️ Common mistake
Forcing a deep, jagged "V" into a cup. The pattern works because the rounded base shows orderly accumulation; a sharp spike low is a different, less reliable structure.
FAQ
How deep should the handle be?
Shallow — typically a fraction of the cup’s depth. A deep handle that erases most of the recovery weakens the pattern. This page is practice, not advice.
Is it bullish or bearish?
It is a bullish continuation pattern, most reliable after an existing uptrend and confirmed by the handle breakout. Not financial advice.