Inverse Cup (Cup & Handle Top) Chart Pattern — How to Spot and Trade It

An upside-down rounded top with a small upward handle, then breakdown.

In plain words

An umbrella dome: a smooth arch up and over, a small bump, then the drop.

What the classic books say

The Inverse Cup (Cup & Handle Top) is a reversal pattern with reference reliability Medium and illustrative behaviour of ~58-65% on breakdown (the kind of statistics catalogued in Bulkowski's encyclopedic pattern studies and Murphy's technical-analysis classic). Less common; treat with extra confirmation.

Level by level

Beginner

Price rounds over at the top, takes a small breather up, then breaks lower.

Intermediate

A rounded distribution top and shallow bounce set up a breakdown.

Advanced

The bearish mirror of cup & handle; volume on the breakdown matters.

Trade plan (educational template)

• Entry: On a breakdown below the handle.
• Stop-loss: Above the handle high.
• Target: Dome depth projected down.
• Check the numbers with the Risk-Reward calculator before any entry.

Common beginner mistakes

• Confusing with a normal pullback

Practise it now

• ▶ Draw the Inverse Cup (Cup & Handle Top) with live trendlines and a ghost forecast
• 📖 Full lesson in the Learning Hub

_Educational content only — not financial advice. Historical behaviour never guarantees future results._