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The Cup and Handle pattern is a bullish continuation chart pattern that signals a potential upside breakout after a period of consolidation. It resembles the shape of a tea cup — the “cup” forms when price declines gradually, finds support, and then rises back to near its previous high, creating a rounded “U” shape. The “handle” forms next as a small pullback or sideways movement, indicating a brief pause before the next move. Once the price breaks above the handle’s resistance with strong volume, it confirms the pattern and suggests continuation of the uptrend. In short, this pattern shows accumulation followed by a breakout, often leading to a strong upward rally.