Candlesticks and chart patterns

Reversed Cup and Handle Pattern Candlestick charts reveal a wide range of price action patterns, each offering clues about potential market moves. One such powerful and widely-used bearish pattern is the reversed cup and handle . Reverse cup and Handle pattern In this Market Investopedia blog, we’ll explore what the reversed cup and handle pattern is, how to identify it, and how traders can use it to spot potential shorting opportunities. What Is a Reversed Cup and Handle Pattern? The reversed cup and handle , also known as the inverted cup and handle , forms when an asset's price rises and then falls to create an upside-down “U” shape. This is followed by a small upward retracement—the handle. The pattern completes when the price breaks below the support level , signaling a bearish continuation. This setup typically appears during a pause in a downtrend , and its completion often leads to further downside. Key Components of the Pattern Cup The pattern begins with an inver...