A "Cup & Handle" for Bitcoin?

5 Jan 2022

Recently, a Friend of mine asked me if there could be a Cup & Handle on the daily Timeframe for Bitcoin. My answer was, Maybe. Let's do some digging.

Common Identification

• Price: Should be rising into the start of the Cup
  
• Shape: Needs to be U-Shaped / not V-Shaped
  
• Handle: Handle on the right side
  
• Cup Duration: From 7 to 65 Weeks
  
• Handle Duration: 1 Week minimum with no maximum, forming in the upper half of the Cup with a maximum to the middle.
  
• Cup: Cup rims should be near the same Price level but be flexible (Neckline)
  
• Volume: Should be declining within the Handle, at least lower than within the Cup
  

Analysis
So, in this Cup & Handle, we have a rising Price into the start of the Cup. The Cup is also U-Shaped and not V-Shaped. The Handle is on the right side, but fairly deep, currently around the middle of the Cup size - which already could be a Red Flag. The Cup duration is about 30 Weeks and the Handle duration is 8 Weeks, which is in Range. The Cup rims are a bit apart from each other, but still in a Range which could be considered OK. The Volume within the Handle is declining.

Should one trade this Pattern right now? Frankly, NO! This still needs to evolve. The Pattern could be traded if the Price closes above the Neckline, a Stop loss is generally put below the Handle, adjust the Stop loss according to the Price movement.

To be said: This is not a Textbook "Cup & Handle" in my opinion.


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This Analysis is not intended to be investment advice. Always DYOR.

24 Jan 2022

Nota

This Pattern is FULLY INVALIDATED - although the falling channel might be Thing! GL everyone