Cup & Handle
A long rounded base, then one last small shakeout — O'Neil's classic launchpad for growth leaders.
Continuation PatternsIntermediate 5 min read· Lesson 5 of 6 in Chart Patterns
Structure & psychology
The cup: a gentle U (not a sharp V) carved over weeks/months back to prior highs — weak holders cycled out patiently. The handle: a short, downward drift near the highs — the final shakeout of nervous profit-takers before the breakout. Ideal handles form in the cup's upper half on light volume.
Entry
Break above the handle's high on strong volume — the pivot. NEW_20D_HIGH plus VOLUME_SPIKE in the confluence scanner approximates this trigger mechanically.
Stop loss
Below the handle's low — the shakeout zone failing means the base isn't done.
Target
Cup depth projected from the pivot, though leaders exiting sound bases often trend far beyond measured targets — trail instead of capping.
Failure conditions
V-shaped 'cups' (no real accumulation happened), handles that slice into the cup's lower half, or breakout volume that never arrives.