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Predicting Short-Term Trends: The Cup-With-Handle Pattern

by Wayne A. Thorp, CFA

Predicting Short Term Trends: The Cup With Handle Pattern Splash image

Price charts are one of the most widely used tools in technical analysis. What do charts reveal? One item technical analysts like to look for is repeating patterns—these can be used to forecast future price movements and, in some cases, the potential magnitude of such movements.

This article examines a price pattern identified by William O’Neil, founder of Investor’s Business

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Wayne A. Thorp, CFA is a vice president and senior financial analyst at AAII and editor of Computerized Investing. Follow him on Twitter at @AAII_CI.


Discussion

Michael from New York posted over 2 years ago:

It is always very easy to look back on a stock and say what happened after the fact. It is very different to try and do it real time. Your three examples sum it up very well. As a matter of fact you left out the double and triple cups that never had a breakout!


Rudy from New York posted about 1 year ago:

Almost impossible to read the text and follow the "impossible to read" chart.


John from California posted 5 months ago:

I am (finally) committed to learning CANSLIM. This article does a fine job of getting into the nitty gritty without being overly technical. Good prep before diving into the latest edition of William O'Neil's CANSLIM guidebook How to Make Money in Stocks.


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