Cup and Handle Formation

The stock is forming a cup and handle pattern and looks good above 498 level


Am sure you must have read it but it happens to most of us including me that we skip the most important part of the technicals esp. when we are analyzing the charts day in & day out. William J. O'Neil defined Cup and handle pattern and he defined it as the pattern formed at the highs / old highs. So any similar visual pattern should not be defined as cup and handle. the logic of its formation states why it should be formed at the highs.

Also it does not mean that the stock wont move as per your expectation. It is just that some patterns have more relevance at a particular location. For. e.g. ascending triangle pattern works with higher probability at resistance than at support and vice versa with descending triangle if one knows what is the logic of its formation.

Just thought of sharing this. Am sure you are doing a great job in technicals and kudos to your endeavour of posting so many posts.
+6 Reply
@mitresh, Thanks for sharing. While many famous authors have shared their wonderful experience and knowledge via great book, everyone perceive charts differently. There is always debate that certain price action patterns should form at certain places but above formation is valid and to me looks high probable setup.
Practical experience is far better than any textbook knowledge which is not applied. If you check Tanya's past chart, she has great accuracy in Rounding bottom & cup & Handle patterns. I am sure you can utilize your gained technical knowledge to share charts to this wonderful community.
tanya151181 Piyush-Gupta
@Piyush-Gupta, thanks for the clarification sir 😊 You are the best mentor I could ever ask for
+1 Reply
mitresh Piyush-Gupta
@Piyush-Gupta, hey.. its great to have your feedback on my post. One can always interpret charts differently which is why technical analysis is such a wonderful topic to work on. However, lot of textbooks dont talk about the logic of the pattern or why the pattern is forming, what is happening between the buyers and sellers at that location, if one understand the details, there can only be one interpretation as far as patterns are concerned cos location and volume are two critical factors in most of the patterns and they are commonly ignored over the shape of the visual.

Also my comment was strictly related to the definition of the pattern and not on analysis/view/expectation of the move/practicality or past records.
Very good chart. Also it has closed beyond 20/50/100 daily and weekly ema. To me also it is a healthy upward trend. Very likely to cross that resistance level, or neckline of inv H&S pattern, and continue up move in coming days. Thanks for sharing Tanya.
+1 Reply
KetanM KetanM
@KetanM INV cup and handle pattern, not H&S.
ye buy karne layak ha.????????
+1 Reply
inverted cup is a bearish signal right?
+1 Reply
@ada0492, no its bullish
+1 Reply
ada0492 tanya151181
there is an ascending triangle in the 5 min time frame
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