The Cup and Handle pattern = a one-sided rise + a pullback + a buildup of momentum + a breakout. The formation process of the Cup and Handle pattern is as follows: the price first experiences a pullback, slowly bottoming out, and forming a "cup"-like arc. This is a correction and digestion of the previous gains. The price then rebounds to near the previous high, but due to short-term selling pressure, it enters a period of slight sideways trading or a slight decline, forming the "cup and handle." There are two true buying points: 1. When the previous high is broken, the market confirms a re-entry into an uptrend. (This is essentially the same logic as betting on a breakout at the end of a triangle pattern.) 2. If you miss the breakout, you can follow up after a pullback or a rally of no more than 5%. (This is essentially a wide stop-loss, betting on a further upward breakout.) The stop-loss is usually set below the low of the cup and handle (a wide stop-loss is essential).