8.4 KiB
The Cup And Handle Pattern Explained For Dummies 🚀
| Author | Source |
|---|---|
| u/possibly6 |
Re-uploading with a different title cause y'all don't like seeing low numbers lol
Good evening apes, sorry about the late upload tonight. Update on my health, I'm still sick as shit, hence the later upload. I nap for like half the day.
Remember, not financial advice yadayadayada don't listen to me I am ape.
I'm sure you have seen some posts talking of the cup and handle pattern. If not, well you're not really missing anything. In my last post I discussed briefly what the cup and handle pattern was, you can check out that post here if you want.
"Also, the more we dip, the more the "cup and handle" pattern becomes validated, up to a certain extent. Will talk more about this in my next post, but basically, in simple ape terms, the timeline of a cup and handle is high price, big drop to very low price, then push up again to high price, then dip to a lower (but not as low as the first low) price, then MOOOOON BITCH!"
So today, interestingly enough, the cup and handle pattern did indeed present itself on the 5m timeframe. I ended up buying more shares around 180 today, more on that later, but look at this image to visualize the cup and handle from today.
Pretty self explanatory no? The chart literally looks like a cup, and the handle is formed in a downward wedge (marked by the red lines), then BOOM breakout.
So, now let's look at GME on the daily chart. For visual purposes, this isn't a candlestick chart, though you can see the pattern is clear as day.
As the title of this post (used to say, edited cause y'all thought i was a shill lmao), I personally WANT GME to dip down to the 140 range. Allow me to explain.
Remember in my previous posts how much I'd emphasis gaps and how they should be filled? Well it turns out I actually didn't even see one that occurred on March 8th. It's very hard to see here, but the tight green box represents the gap up
Here's a view of the 30 min chart. The very bottom green box is the gap up from march 8th, that I would like to see filled.
Keeping today's DD shorter, just know that if we see 138-140, I am ABUSING THE FUCK OUT OF MY BUY BUTTON!!! I wouldn't necessarily count on this dip, but if it happens just know it's part of the process. Shortly after hitting this level, I would expect to moon like we've never mooned before. At the end of the day when this bitch hits over 100k, are you really gonna be mad your avg cost was over 200 and not cheaper? I know I won't.
TLDR: We may indeed see a drop to around 140, I honestly hope we get it so I can snag more cheapies. Timeframe for this is unknown, but I would like to see it sooner rather than later (preferably a few days). Remember price doesn't matter, I don't even check my port value throughout the day unless I'm buying. HODL!
Obligatory 🚀 🚀 🚀
BEST "BUY THE DIP" PRICES TO WATCH THIS WEEK 🚀
Good evening fellow apes, its yaboy u/possibly6 back with some more crayons on computer screens and price predictions (reposting with different title as i find it more fitting for the dd)
Before I begin, remember this is not financial advice, I literally come up with price targets using crayons.
My apologies apes for not posting a DD last night, I'm pretty sure I have pneumonia or some bullshit so I've been trying to rest up as much as possible.
Soooooooo, down 44 points today? yawns is that all you got shitadel? If you missed my last DD on price targets, I talked about how it was more likely than not to see the 204-211 gap filled. Remember when a stock gaps up/down, 9 times out of 10 it will fill the gap, usually in a very short timeframe. Today's low hit 206 on the dot. Sooooooo, what does that mean for the rest of the week?
I'll save you guys some time, for all you smooth brained apes that don't like to read, the levels I will be watching tomorrow are 187-193 (depends on the time of day as it is a slanted support). If this level fails, the next level would be 157 ish. If that fails, the next support level I have is 143.4. Allow me to explain the significance of each level.
Next support at 187
For those unfamiliar with basic charting, support and resistance lines are drawn when a stock hits a certain level 2 or more times. The more it hits the level, the stronger the support/resistance is. Look at the 4hr chart, specifically the light blue line. The support is valid, as you can look back a few days before we broke 200 and see that the stock bottomed on that line multiple times. With that being said, it is a defined and strong support level, and the next level I have GME hitting should it continue to drop (I believe it will).
After 187, the next support is 157.
Remember that monster gap down we had back on Feb 1? To any new apes aboard this rocket ship, dips like what we saw today are pussy shit. Idk about you guys, but If I can hold from 513 to 38, I can sure as hell hold from 345 to 38 (highly doubt we ever see levels that low again ever). Anyways, the pink box represents the gap down from Feb 1. With gap ups/downs, the top and bottom of the gap often times act as support.
Perfect example, if you look at today's price action, we seemed to bounce right at the top of the pink box (also where the 38.2% retracement level is, these 2 levels together made for a strong support today towards close, hence the bounce.)
If all else fails, 143.4 is the next support
This is the 23.6% retracement level from all time highs. If you don't understand fib retracements, give this a quick read. It'll transform your trading. Sorry for the cluttered workspace, but this image should give you a visual representation of the 23.6% level.
So how do I plan to play this week? Well for one, I don't know what a sell button is, so selling is out of the question. My plan is to AVERAGE IN to each of these dips, meaning I use the same amount of capital at each level. This way If I buy the dip but it keeps dipping (we've all been there, don't lie to yourself), you have more capital to average down. What if the dip of the dip keeps dipping? Well you've got some capital left over cause you, being the smart ape you are, prepared for this and knew which levels to watch and when to AVG down.
I'm ngl, I got a little trigger happy and threw a lot of capital in today at around 240, and more at 208. Anything under 200 is a steal in my eyes.
Also, the more we dip, the more the "cup and handle" pattern becomes validated, up to a certain extent. Will talk more about this in my next post, but basically, in simple ape terms, the timeline of a cup and handle is high price, big drop to very low price, then push up again to high price, then dip to a lower (but not as low as the first low) price, then MOOOOON BITCH!
Example
This pattern has appeared on GME many times in the past, for any OG apes, this pattern formed right after the Q3 er conference. Those who paper handed hated themselves and those who diamond handed and avg down were rewarded.
I suspect shorts will play dirty this week to try and shake out the weak hands, show them the true power of diamond hands by eating up those dips. I know I will.
TLDR: GME is hard to predict as we're riding the waves of whales. Support levels to watch tmr are 187-193 (depending on time of day, the number increases as the day goes on), 157, and 143. Smart apes would AVG in to these levels, but remember anything under 200 is a good deal (at least in my eyes). HODL FOR BANANA! I EAT DIPS FOR LUNCH!
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