Chart patterns cup and handle cheat sheet

1. This patterns looks like a cup profile with handle on right side of the chart.
2. Cup and handle chart pattern has low failure rate 
3. This chart pattern has 5 % failure rate in bull market and 7 % failure rate in bear market.
4. Chart pattern having short handle tends to perform better then chart having longer handle.
5. During the formation of handle volume start decreasing. 
6. When price move higher than the handle high breakout happens.
7. Cup formation duration should be more than 7 weeks
8. Total decline in  stock price during the cup formation is between 12% -15% or in some time it is 33 percent.
9. Handel formation duration for cup and handle chart pattern is minimum of 1 week.
10. Cup without handle formation is not a valid chart pattern.

                            

1. Handle formation duration less then one week is not .
2. During the completion of cup formation stock price level should be equal to the previous edge of cup.
3. It is a continuous pattern. Means it works good with up trending stocks.
4. Average rise after the breakout is 34% in bull market and 23% in bear market.
5. In bear market this chart pattern rare ally develops .
6. During the chart formation if volume formation is also U shaped it outperformed the other volume patterns.
7. Rising volume matters only in bear market. In bull market rising volume has no relevance in chart pattern.
8. To set the target measure the total depth of the cup. Check the stock price at the top of the cup formation and lowest price. Subtract the number and divide the number by 2 and set the target.
9. E.g. Stock price during the starting point of cup is 100. Lowest point of cup is 70. The difference is 30. To set the target Divide 30 by 2 = 15 Points.
10. After the handle formation and breakout set the target of 15 points.
11. Stop loss for the trade is the lowest point of handle formation.
12. When stock moves up set the stop loss at the entry price.
13. Book your gains when stock reach the desired target.
14. Success rate of meeting the target is 80% .
15. Failure rate of this chart pattern is only 5%.

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