ELN Cup and Handle
By Johns Wu on Sep 06, 2005
I had a feeling this would happen. ELN is forming a cup and handle continuation pattern. The textbook definition states that a breakout can occur once the handle formation has completed on descending volume.
However, my experience with cup and handles is that they can frequently fail.
The cup has formed in 1 month and the handle is continuing to form from last Friday’s downward pressure on light volume. I’m going to hang on to this stock as it retraces to see what happens next.
DISCLAIMER: I hold long positions in ELN.
2 Responses to “ELN Cup and Handle”
one month for a cup and handle is too short wouldn’t you say? 4 weeks is simply not long enough to be considered a cup and handle. There’s just too much market fluctuation in such a short term to be deemed a pattern. A more propoer cup and handle from ELN Seemed to have occured June 2003 to February 2004, albeit that was a longtime ago.
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I’m interested in ELN, too. Now we just need very low volume during the handle formation and have that pick up right before breakout.