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Tagged: CUP Pattern
Cup pattern usually takes more than 6 months or years to be formed.
a rounding bottom is identified during this time period with low volume and no aggressive buying.
once the price breaks the handle of the cup a bullish trend is identified.
If stronger hands gradually accumulates a stock in around around 10 months to a year, then it forms a rounding bottom, that is there would not be a big rise or low in price of the stock. After the price had traveled more or less the same price for around a year and then if it breaks the cup and goes high, then it is a bullish trend.
A pattern which looks like a cup forms when someone or some investor starts to accumulate shares and this pattern forms a like a bottom of a cup and during this phase neither the price goes up nor comes down for a long period of time and people get frustrated and start selling and with aggressive selling aggressive buying also takes place and price keeps going and heavy buying takes place and reaches newer high prices and this trend goes on for a longer period of duration.
Cup pattern usually takes years to form, during which there will be low volume as it is the gradual accumulation of the stronger hand, if the price breaks above the cup, then it can be considered for the long position.
It is a slow but gradual pattern which indicates an accumulation process. It usually doesn’t sync with the market. The duration is around 6-12 months.
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