1. A pattern that is formed after a pullback from a swing high rallies back
strongly to the prior swing high and stalls due to overhead resistance. The security
then stalls much like a bull flag with slight downward pressure before breaking
out of overhead resistance.
2. The power of a Cup and Handle lies in the fact that after hitting overhead
resistance from the prior swing high, a very minor correction is put in. The stock
then breaks out past resistance which can be a sign that demand for the security
may be increasing.
3. Cup and Handle patterns can be stronger when the next logical place of
resistance on the chart after the breakout is a considerable distance away.
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