🌪️ What is it?
A bearish reversal pattern resembling an upside-down cup 🫗, with a small handle above it!
It usually appears at the end of an uptrend and warns of a market turn to bearish ⬇️.
🔍 How does it form? Step by step:
1. Inverted Cup Stage (U)
- The price rises then drops sharply (forming a peak ⛰️).
- Then it rebounds upward but weaker (forming a curve resembling an inverted U).
> 📉 Example: `Price: $100 → $70 → $95`
2. Handle Stage (weak rebound)
- After the rebound, it makes a **small correction upward 🎢 (like the cup handle).
- But this rise is weak and does not break the previous peak!
> 📉 Example: `Price: $95 → $88 → $92`
3. Downward breakout (💥 disaster!)
- The price breaks the support line below the handle.
- This is where the bearish reversal begins
> 📉 Example: `Price: $92 → $85 → $80 →
🎯 How to benefit?
- Enter a sell: when the support line is broken below the handle.
- Downward target
Length = (Cup top - Cup bottom)
Target ≈ Break point - Length
- Place the stop-loss just above the handle!
⚠️ Golden tips:
- ✅ Ensure high trading volume at the breakout (indicates downward strength).
- ❌ Avoid rushing before the pattern is complete (see the image ↓).
- ✨ Use it with other indicators (like RSI or moving averages).
💎 Summary:
The inverted cup and handle = Inverted cup 🫗 + small handle + support break ↓
A strong signal to sell/escape from the stock! Prepare for the downward storm 🌧️💸
> Note: The pattern can appear in all time frames (weekly/daily/hourly).
