Cup and handle

The pattern, popularised by investor William O'Neil, starts with a rounded decline and recovery that forms the cup, ideally a smooth U rather than a sharp V. Near the previous high, price pulls back slightly and drifts sideways or down in a smaller range, the handle, as remaining sellers are absorbed. A breakout above the cup's rim on rising volume completes the pattern. The typical target adds the cup's depth to the breakout point.

In crypto, cup and handle formations are often pointed out on multi-month charts, for example when bitcoin or a large altcoin recovers to a prior cycle high after a long base. On large timeframes they get attention because a confirmed breakout would mean new highs.

Cups can take months to form and many never complete; the handle can turn into a deeper decline. Pattern targets are rough guides, and on low-liquidity tokens the shape can be painted by a few large trades.