Hey, what's up everyone? This is Shana Warrior trading and today I Want to go over the cup and handle cutter and some different ways that you can trade it. So what is the cup and handle pattern? Well, it's the continuation chart pattern that forms a cup and handle with the defined resistance level at the top of the cup. It starts with a strong drive up, followed by a pullback and consolidation over a period of time creating the cup before making another push to the resistance where it pulls back again but not as far creating the handle and then makes its final push past the resistance level, continuing on its trend. So some key characteristics: you'll want to see a strong Drive on volume to start the pattern and then you'll see a pullback to consolidation with a move back up to the previous high creating this defined resistance level.

You'll then see a smaller pullback that will create the the handle and after that you'll get a break through and resist through the resistance on volume. This works on any timeframe, but I've found it to have more success on a higher time frames like the 30 minute and the daily especially. you can get some really good moves on it so let's go over some examples. this one is on Boeing This is a daily chart.

This is a really clean cup and handle so you see you have this strong move up where we hit a little bit of resistance here and then we pull back and form this consolidation saucer looking which turns into the cup. On this pattern we hit the resistance and then we pull back again creating the handle before moving back up and breaking through and continuing on the trend. This is a really good pattern. The only thing I would have liked a little bit more on this is if it had more volume coming in through here as it broke out I was still pretty light.

we didn't really get a volume spike. it's all over here when it was well past the resistance level. but overall this is a really clean setup. so a couple different ways with trading the cup and handle pattern.

I Like to get it when it breaks out and then you can look to place your stop below the handle. Now some patterns will be deaf and this one had a really far stop from where the breakout area was so you can look at using the 20 EMA as your stop if it gets below that or if you have a set of mahalik. if you don't want to risk more than $1 per share it then you know you could have put it in. At two, resistant area was around 186, you could put us up in at like 185 184.

I depend on how volatile the stock as you want to look at the ATR and then after that you just want to take profits as it moves in your favour according to your trading plan. So this is a really clean setup. Broke out and kept moving trended nice. We have another one here on GLW This is a daily chart as well.

You can see we had to drive up and then we had a really strong pullback. Saucer this formed over, you know a couple months before coming back up to this resistance level. You could have taken it long here. You would have been stopped out because it kind of formed like a double little bottom in the handle here before actually breaking out here where we have a nice little volume day come in and you could have tried getting long on it again for the breakup.

So this is another clean cup and handle pattern. We have another one here with Fnw. You can see this one had a shallower handle so it'd have been a better stop here to use on the breakout. Otherwise you could have used the the EMA as well.

But you can see we had a nice strong drive up a pullback to consolidation, created the saucer to the cup and then we had a you know resist hit the resistance, had a hard time getting above it, then I rejected it right here pullback and we had this little cup or excuse me handle form right in here before breaking back out. So those this is what the cup and handle pattern looks like and what you want to look for. The main thing that you want to see is volume. Come in on the breakout.

That's super important. So that's a cup and a new pattern. Let me know if you have any questions in the comments below. Alright guys, next time.

Oh hey I didn't see you there well I Was just working on the dream board for my next home run trade. Hopefully it comes soon. Until then, make you subscribe to get email alerts anytime. I Go live or upload new videos.

Until then, happy surfing!.