their rise. This formed the cup handle (incidentally,the handle in this formation is a high, tight flag formation). Volume duringformation of the handle was down sloping—higher at the start and trendinglower. When prices rose above the cup lip, a breakout occurred. This accompanied a surge in volume that propelled prices higher. However, a week afterthe breakout, prices threw back to the handle top before continuing upward.
Figure 9.1 Bump-and-run reversal that leads to a cup-with-handle formation.Note the price scale as the breakout occurs at about 30 and the stock climbs to120 in less than 2 months. The cup handle is a high, tight flag formation.
This throwback allowed nimble investors the opportunity to enter long positions or add to existing ones. By late May, just 44 days after the breakout, thestock reached the ultimate high of 120.
Identification GuidelinesIn the study of chart formations, when I search a database for various patterns,I ignore most conventional selection criteria. I let the formations determinetheir own characteristics. That is the approach I used in selecting the cup-withhandle formation. After making my selections, I sorted the database accordingto my interpretation of O'Neil's selection guidelines and compared the performance. Table 9.1 shows the O'Neil selection criteria, the guidelines I usedto select formations, and my interpretation of his criteria.O'Neil outlines many selection guidelines in his quest to find suitablecup-with-handle patterns. He found that the performance of a stock, relative tothe performance of other stocks, is important. A stock with improving relativestrength helps weed out underperforming situations.I do not know which stocks he used to compute his relative strength characteristics, so I did not use relative strength as a selection rule. If I had, thenumber of stocks meeting O'Neil's guidelines may have decreased further (just
Table 9.1\Two Different Approaches to O'Neil's Cup-with-Handle Pattern
O'Neil Criteria
UnfilteredSelectionGuidelines
Filtered SelectionGuidelines: The O'NeilInterpretation
Improving relative strengthSubstantial increase in volumeduring prior uptrendRise before cup is at least 30%U-shaped cup
NoneNone
Cups without handles allowed
Cups must have
Cups must have handles
Cup duration: 7 to 65 weeks
handlesSame
Same
None
12% to 3 3%
1 week minimumNone
1 week minimumSame
None
Same
Selected if handletoofo like it formedin upper half; 16%failed but wereclose and usedanywayNone
Same
SameSame
None, information unavailableVery high volume during riseto cupSame
Same
Cup depth: 12% or 15% to
33%. Some decline 40% to
50%Handle duration: usually atleast 1 to 2 weeksHandle downward price trendHandle downward volumetrendHandles form in upper half ofcup
Handle forms above 200 dayprice moving averageHandle price drop should be10% to 15% from high unlessstock forms a very large cupHigh breakout volume, at least50% above normalSaucer with handle pricepattern has more shallow cupsNone suggested
None
None
NoneCup edges shouldbe at about thesame price level
Handle low above 200 daymoving averageHandle decline from right cuphigh to handle low must be15% or lessBreakout volume at least 50%above 25-day moving averageNo distinction madeCup edges should be at aboutthe same price level
Note: The best performance comes from the unfiltered selections in the center column.The word same refers to the guideline shown in the left column.
Identification Guidelines
139
9% meet his guidelines as it is) and the impact on performance is unknown.For those stocks that meet his selection criteria, I looked at each cup-withhandle formation and verified that there is very high volume somewhere on therise leading to creation of the cup. Of the formations obeying the O'Neil criteria, only one successful formation was excluded as a result.As I was selecting cup-with-handle formations, it became apparent thatlocating cups during an uptrend is important. So, I adopted O'Neil's criteria ofa minimum 30% rise leading up to the cup.All the cups are U-shaped (V-shaped ones being removed). Also removedfrom the study were cups without handles. To me, a cup without a handle is arounding bottom. I discuss rounding bottoms in Chapter 34.I use a strict interpretation of O'Neil's cup depth. A maximum depth of50%, although increasing the number of cups meeting his guidelines, raises thefailure rate along with the average gain. However, neither the failure rate northe average gain changes significantly, so I used a range of 12% to 33%.O'Neil specifies a number of guidelines for the handle. He says the handle should be a minimum of 1 to 2 weeks long, but does not set a maximumduration. In my observation of the formation, prices can, and often do, movehorizontally for several months before staging a breakout.As I examined each chart for the pattern, I eliminated those with handlesthat form well below the midpoint. However, I was not concerned if my casualobservations included a few cups with handles that fell below the center.Removing all handles that are lower than the cup midpoint boosts the averagegain just 1% to 3 9%.As you can see from Table 9.1,1 ignore many of the O'Neil criteria whenselecting cup-with-handle formations for further analysis. Once I collected thechart patterns, I filtered the cups through my interpretation of the O'Neil criteria. This grouping of methods, unfiltered and filtered, yielded two sets ofperformance statistics. But first, let us take a look at a few examples of cupwith-handle patterns.As mentioned before, the cup pattern shown in Figure 9.1 does not meetthe O'Neil criteria. Why? The cup depth, at 54%, is too deep to qualify. Additionally, the handle price trend is upward, not downward. Price and volumetrends were evaluated using linear regression from the day after the right cuplip to the day before the breakout. Excluding those 2 days helps remove possibly large price moves. I used closing prices in the calculation on the remainingdata (for the handle price trend).Figure 9.2 shows another good example of the cup-with-handle pattern.The cup gently rounds over and climbs just beyond the old high then pauses.Prices drift down in the handle, along with a down-trending volume pattern
before the breakout. Then volume surges and prices move smartly upward.Two days after the breakout, prices move marginally lower again and enter theregion of the right cup lip. It is a brief throwback and prices are soon on theirway again. Less than 2 months later, die stock tops out at 15l/2 for a rise of 22%.138
140
Genetech, Inc. (Drug, NYSE, CNE)
Cup with HandleMentor Graphics (Computers and Peripherals, NASDAQ, MENT)
_ 1 -/
I
Next Cup
91
Apr 93
May
Jun
|ul
Aug
Sep
Oct
Nov
Dec
|an 94
Feb
Figure 9.2 A cup-with-handle pattern. The cup and handle are shaped nicelywith the right cup lip slightly higher than the left.
A SON
AS OND
D92F M A M
Figure 9.3 Cup-with-handie pattern on a weekly scale. The failure at 10% to 15%above the breakout is quite typical for this formation. However, this stock recovered and continued upward.
Adobe Systems (Computer Software & Svcs., NASDAQ, ADBE)
If you look on either side of the cup in Figure 9.2 you will find two additional cups (portions of which are shown) that fail. The one on the left breaks
Invalid Cup Selection
out downward and the one on the right fails to continue rising by more than
5%, so it too is a failure. Only die center cup works as expected but even itshows muted gains. We see in the Statistics section that a significant numberof cup-with-handle formations fail to rise very far.
Figure 9.3 also shows a cup-with-handle formation but on the weeklytime scale. When I was searching for the various formations, I found thatweekly scales provide an easy way to identify many of the formations. Ofcourse, I also looked at daily price data to refine the weekly patterns and identify new formations that I may have missed.The chart in Figure 9.3 shows an example of a cup-with-handle formationin which the rise falters after rising just 11%. Fortunately, after declining back
to the handle base, the stock recovers and goes on to form new highs. Ultimately, the stock gains 52%.Figure 9.3 also highlights an incorrectly selected cup: an inner cup. There
is no 30% rise leading up to the formation (since prices are trending downward)and the handle lasts just 2 days. However, inner cups offer wonderful tradingopportunities as they allow you to get in on the ground floor of an impendingrise. Even if prices only rise to the height of the outer left cup lip, the move canbe significant. A discussion of trading tactics occurs later in this chapter.Figure 9.4 shows another example of an errant cup selection. The risefrom point A to point B is less than 30%. Had you invested in this pattern after
Apr 93
Figure 9.4 An invalid cup-with-handle pattern. The rise from point A to point Bis less than 30%. The two outer peaks (in June and March) do not create a cupeither because the handle drops down too far (point C)—well below the cup midpoint.
141
142
Cup with Handle
Focus on Failures
prices rose above the cup lip, you would have seen the stock climb to 341/2, anincrease of just 11%. After it reached the high, the stock plummeted. In lessthan a month, prices declined to 2ll/i, a loss of 38%.
Focus on FailuresThe cup-with-handle formation, like most formations, suffers from two typesof failures. The first type of failure is shown in Figure 9.5. The cup formedafter an extended rise that began in mid-December 1993 at I5l/i and rose to theleft cup lip at 243/s. Prices quickly reversed course and moved lower, thenbecame choppy as they traversed the cup bottom. Once an upward trend wasunderway, the choppiness smoothed out and prices soared to the right edgeof the cup.The day before prices reached a new high, high volume soaked up thedemand for the stock. The stock coasted to a new high the next day thenmoved lower. A handle formed about a week later in the 22-2 3 range. The volume trend during this time was sloping downward, as you would expect. However, prices dropped through the handle low, pulled back into the handle, thendropped away again. From that point on, it was all downhill. A low reached inlate January at H1/: shows a decline of 42% from the cup lip.
|an 94
Feb
Mar
Apr
May
|un
Jul
Aug
Sep
Oct
Nov
143
As you look at the cup-with-handle formation in Figure 9.5, you see little that is out of the ordinary. The right edge of the cup is somewhat above theleft edge. Minor differences between the two cup edges are normal. Sometimesthe left edge is higher and sometimes the right one is higher.Volume during formation of the cup is about average for this stock.Instead of a cup-with-handle formation, what you really are looking at is a double top. The two widely spaced peaks, the first in March and the second inAugust, predict a decline in the stock.The vast majority of cup-with-handle formation failures break out downward. Of the formation failures identified in the database, 74 have downsidebreakouts and only two of those turn around and finish higher by more than 5%.The second type of failure is the inability of the stock to rise by at least5% before declining. Figure 9.6 shows this situation. The nicely shaped cupforms after an extended price rise from 33 to 45. The two cup edges are atabout the same price level. The handle seems to form a small cup of its own.Prices move up sharply in late September and break above the right cup lip andcontinue higher, but only briefly. The stock tops at 477/8, moves horizontallyfor about 3 weeks, then starts down. Two months later, the stock hits a low of375/g. The rise after the breakout is slightly less than 5%. I classify as a failurea stock that does not continue moving more than 5% in the direction of thebreakout. Of the formations with upside breakouts, only 10% or 30 failedbecause they did not continue climbing by more than 5 %. It seems that oncean upside breakout occurs, prices generally continue climbing—at least 5%anyway.
Dec
Figure 9.5 A cup-with-handle formation that breaks out downward. It should serveas a reminder to always wait for the breakout to move above the cup lip before buying the stock. This cup-with-handle formation turned into a double top.
Figure 9.6 A cup-with-handle formation 5% failure. Although prices break out upward, they move less than 5% away from the cup lip before plunging downward.
144
Cup with Handle
V
StatisticsAs mentioned earlier, I first selected the cup-with-handle formations then filtered out those chart patterns that did not obey my interpretation of O'Neil'scriteria. Listed in Table 9.2 are the results. Just 9% of the selected patterns methis selection criteria (outlined in Table 9.1). Of those meeting the criteria,only 62% perform as expected. That is to say, 38% either break out downwardor fail to rise by more than 5% before reaching the ultimate high. The averagerise of successful formations is 34%, but the most likely rise is just 15%. Sinceonly 23 formations were successful (a small sample count), the frequency distribution used to determine die mosu likely rise is suspect but it does agree withthe unfiltered (non-O'Neil) formations.O'Neil suggests that there should be a substantial increase in volumesomewhere during the rise to the cup. I excluded only four formations becauseTable 9.2Statistics and Results for Cup-with-Handle Formations Filtered by Manyof O'Neil's RulesDescription
Statistic or Result
Number of formations
37 out of 391
Failure rate
14 or 38%
Average rise of successful formations
34%, but most likely rise is 15%
Is substantial increase in volume duringprior uptrend important?
No. Only 4 formations were excluded(if included, performance deteriorates).
Is cup length from 7 to 65 weeksimportant?
Unknown. All selected cups fall in thisrange.
Is cup length related to ultimate gain?
No. Relationship is random.
Does cup depth (12% to 33%)improve performance?
No. It is detrimental and limitsperformance.
Is a handle duration (1 weekminimum) important?
Unknown. Cups with shorter handleswere eliminated.
Do down-sloping handle price trendsimprove performance?
No. They are detrimental.
Does a down-sloping handle volumetrend improve performance?
No. It is detrimental.
Is it important that a handle be abovecup midpoint?
Yes, but most formations wereselected with this in mind.
Is handle low above 200-day movingaverage important to performance?
No. Has no bearing on performance.
Is it important that handle low is 15%or less from cup lip?
No. Has no bearing on performance.
Is high breakout volume important toperformance?
Yes, but only minimally.
Is cup depth related to ultimate gain?
No. Relationship is random.
Statistics
145
of this item (three formation failures and one 22% gain). However, includingall four formations would increase the failure rate. I did not include thisrequirement in the unfiltered cup selections.Is the cup length important to performance? All the cup-with-handle patterns I selected fall within the range of 7 to 65 weeks. However, I did a scatterplot to determine if shallow cups perform better than deep ones. The plot suggests die relationship is random.Does cup depth improve performance? Placing specified limits on the cup
depth is detrimental to performance. Changing the minimum depth to 30%from 12% and the maximum depth to 55% from 33% improves both the failure rate 'to 33% from 38%) and the average gain (to 36% from 34%). I chosenot to specify any cup depth in the unfiltered cup selections.All the cup-with-handle formations I chose had handles that were at least1 week long. Snorter handle cups were removed from the statistics so it is notclear if this rule is important.Rules regarding down-sloping price and volume trends were found tolimit performance. Removing the two rules decreases the failure rate andimproves the average rise. These two factors are primarily responsible for therelatively poor performance of the filtered cup selections.Is it important how low a handle goes? Yes, and no. I found it importantthat the handle remain above the midpoint (although most cups were selectedwith this in mind, so a fair analysis cannot be performed) but it is irrelevant thatit remain above the 200-day price moving average or within 15% from theright cup lip.Is breakout volume important? Removing this selection rule hurts performance but the change is slight.O'Neil made a distinction between cup-with-handle patterns and saucer-
with-handle patterns. I believe that the difference between the two is only amatter of cup depth, already addressed by the cup depth rule. However, I wondered if cup depth played an important part in determining the average gain.A scatter plot of the cup depth versus percentage gain for unfiltered cups suggests the relationship is random. The scatter plot for the filtered cups also suggests the relationship is random, but samples are too few to be meaningful.Table 9.3 shows statistics for the unfiltered cup-with-handle formations.Only those rules outlined in Table 9.1 for unfiltered selections apply. There are391 formations identified, with 302 of them acting as consolidations of the prevailing trend. Eighty-nine formations act as reversals, with the vast majority ofthem being failures to perform as expected. The failure rate is 26%, well belowthe 38% found for the filtered variety. The failure rate improves dramatically(to 10%) if you wait for the upside breakout before investing.The average rise at 38% handily beats the filtered-cup average rise of34%. However, the most likely rise is between 10% and 20%. Figure 9.7 showsthat most likely gain splits evenly between the first three columns (10%through 20%). The tallest column suggests that large gains skew the average
Table 9.3NGeneral Statistics for Unfiltered Cup-with-Handle FormationsDescription
Statistic
Number of formations in 500 stocks from1991 to 1996
391
Reversal or consolidation
302 consolidations, 89 reversals
Failure rate
1 02 or 26%
Failure rate if waited for upside breakout
30 or 1 0%
Average rise of successful formations
38%
Most likely rise
1 0% to 20%
Of those succeeding, number meeting orexceeding price target (measure ruleusing full cup height)
151 or 49%
Of those succeeding, number meeting orexceeding price target (measure ruleusing half cup height)
223 or 73%
Average formation length
7 months (208 days)
Do short handles show larger gains?
Yes, but relationship may be weak
Does a higher right cup lip mean larger gains?
Yes, with gains of 40% versus 35%
Note: Both the failure rate and average gain improve over the filtered variety.
Figure 9.7 Frequency distribution of gains for cup-with-handle pattern. The mostlikely rise is between 10% and 20%, but the outsized gains over 50% distort theaverage.
146
Statistics
147
rise upward. A quarter of the formations have a rise of less than 15%, whereashalf the formations top out with less than 25% gains. The message from thefrequency distribution graph is clear: If you think investing in a cup-withhandle formation will yield outsized gains, you should think again. The statistics suggest that you have only a 27% chance of selecting a cup formation thatyields a gain over 50%. The chances of doubling your money are just 7%.A discussion of the measure rule occurs in the Trading Tactics section,but it involves adding the formation height to the breakout price (the right cuplip is the breakout point) to predict the target price. The target price serves asa minimum price move. Only 49% of the formations climb to the target price.If you use half the cup height in the calculation, then 73% of the formationsreach their price targets.The average formation length is 7 months, as measured from the left cuplip to the breakout.O'Neil suggests that the handle should be at least 1 to 2 weeks long but hedid not specify a maximum length. I looked at a scatter plot of handle lengthversus percentage gain for successful formations (see Figure 9.8). There are afew formations with short handles (about 3 weeks) and large gains (over 200%)and there are longer handles with shorter gains.
Figure 9.8 Handle length versus percentage gain. Cups with shorter handlesseem to perform better but the relationship may be weak. The line emphasizes therelationship but has no statistical significance.
148
Cup with Handle
Do cups with higher right sides rise further? Yes. The average gain is40% for cups with a higher right lip versus 35% for those with higher left lips.The differences are statistically significant meaning that the results are probably not due to chance.Table 9.4 shows breakout statistics for unfiltered cups. Most (79%) of thecup-with-handle formations have upside breakouts. Only 10% of the formations break out upward but fail to rise by more than 5%. This suggests thatonce a cup-with-handle formation breaks out upward, it generally continuesmoving upward (but not necessarily very far; the most likely gain is only 10%
to 20%).Almost three out of every four formations (74%) experience a throwback
of the gains over the short-, intermediatethe longer it takes to reach the ultimate hI compared the breakout price leveformation has a breakout in the highest ththis surprising except that one selection cra minimum 30% price rise. This uptrendthe top of the formation) into the upper pBreakout volume on the day of the80% above the prior day (or 180% of ththroughout the following week.
to the price level of the right cup lip. This is a very high number and it suggests
a way to improve performance. A discussion of this follows in the Trading Tactics section.The average time to complete a throwback is 12 days, which seems to beabout the number that many of the formation types in this book achieve. Noneof the throwbacks takes longer than 30 days. Although several formations doreturn to the cup top after 30 days, this behavior is normal price action, not athrowback. Figure 9.3 shows this extended behavior during the February toApril 1993 period (remember, the scale is weekly).
Trading Tactics
Table 9.5 lists trading tactics. The measur
stock will rise, at a minimum. The traditioheight of the formation from lowest low ilip. Adding die difference to the high at
It takes 6.5 months for the average formation to reach the ultimate high.
However, a frequency distribution of the duration shows that almost half(47%) of the formations reach the ultimate high quickly (less than 3 months).Over a third (35%) take longer than 6 months. This pattern parallels the mostlikely rise and average rise for the formations. The most likely rise lands withinthe 10% to 20% range while the average gain is 38%. A frequency distribution
Table 9
Trading Tactics for Cup-wiTrading Tactic
Explanation
Measure rule
Compute the formlow reached in thAdd the differenc
result is the target
Table 9.4
minimum. Only 49the cup height toof the time).
Breakout Statistics for Unfiltered Cup-with-Handle FormationsDescription
Statistic
Upside breakout
307 or 79%
Downside breakout
74 or 1 9%
Horizontal breakout
10 or 3%
Upside breakout but failure
30 or 10%
Throwbacks
226 or 74%
Average time to throwback completion
12 days
For successful formations, days toultimate high
6.5 months (196 days)
Percentage of breakouts occurring nearthe 12-month price low (L), center (C),or high (H)
L0%, C0%, HI 00%
Volume for breakout day and next 5 dayscompared with day before breakout
180%, 151%, 127%, 112%, 108%, 108%
Use unfiltered criteria
To achieve the bewhen selecting for
Buy after throwback
Do not buy the stprices slip belowwhich occurs 74%above the lip befoand improves per
Buy inner cup
If you discover a cthe inner cup (wheprepared to sell a
Watch for 15% failure
Many cups fail aftstop-loss orders to
Stop loss
Place a stop-loss oRaise the stop tosupport zone whe
150
Cup with Handle
price. However, this method only has a 49% success rate (less than half the formations reach their price targets). For a better target, compute the cup heightand take half of it. Then continue as before. The stock reaches the new, lowerpriced target 73% of the time. This is still shy of the 80% number I considerreliable, but it gives a more accurate indication of the likely price rise.Figure 9.9 is an example of the two measure rules in practice. Computethe cup height by taking the difference between the right cup high (point A at19) and the cup low (point B at 10). Add the difference (9) to the right cup lipto get the price target (28). Mid-May sees prices hit the target but plummet thefollowing week.A more conservative price target uses half the formation height. Thisgives a target of just 231/z, reached during early July. The stock climbs to thenearer target quickly and without the severe declines experienced on the wayto the more risky price target.When selecting cup-with-handle formations, use the unfiltered selectionguidelines outlined in Table 9.1. When compared with the filtered selectionguidelines, they improve performance.Usually, I recommend buying a stock once it breaks out, but with 74% ofthe formations throwing back to the right cup lip, you might as well wait forthe throwback. Buy after it throws back to the right cup lip and once it rises abovethe lip again. This technique improves the percentage gain from 38% to 39%.
Telxon Corp. (Electronics, NASDAQ, TLXN)
Consider applying this technique toAssume for a moment that the chart showsyou bought the stock after the breakout, you30'/4 and 32 (which was the price range theright cup lip). The stock reached a high ofPerhaps you would have held ontoevaporate. However, had you waited for thpurchased the stock at all. Why? First youback that eventually occurred on MarchThen you would have waited for prices tonever happened, so you would not have puTo be fair, this technique means you w9.9, for example, shows a stock without aoccur within a month of a breakout and thmeans you would not have bought the stocFigure 9.9 also shows an inner cup. Iftion and can identify an inner cup, buy it. Aspaced minor highs that are at about thestock advances to the old high (the outer, lcup-with-handle formation succeeds. Play9.9 would have boosted profits about $2 a sOnce you initiate a trade, place a stopThe handle is a place of support and sometimPlacing a stop just below the low point will gthe stock continues tumbling.When the stock rises, move your stopest your break-even point. That way, if thtected. Continue raising the stop as prices ceventually take profits but saves you from wreversal.
Sample Trade
93 M |
)
A S O ND94FM AM| |
A S O N D 9 5 F M A M I | ASOND96FMAMJ |
Figure 9.9 Example of the two measure rules in practice. Compute the formationheight, divide by 2, and add the value to the right cup lip to get a conservativeprice target. Trade the inner cup-with-handle formation for a better entry price. Aright-angled ascending broadening top appears during June and July 1995.
Cody is in high school. He is not sure whatstill has a few years to figure it out beforeing after cheerleaders, he either has his nosreviewing charts on the computer screen. Hfather's footsteps: The man works for a brropes.Although Cody does not belong to thearound with the players. One day, he overpictured in Figure 9.9. At first he did not tdeeper. That is when he saw it: a cup-with-
152
Cup with Handle
10
He was not convinced the stock was a good trade, but did not have themoney to buy it anyway. He decided to paper trade it to see what he couldlearn. On the daily time scale, he saw an inner cup forming at point C, so thatis the one he decided to trade.Week after week, he waited for the buy signal but it did not come. Eventually, the stock climbed above the right cup lip but he missed it. When he
Dead-Cat Bounce
pulled up the stock chart on the computer, a throwback had already occurred.
So, he waited for prices to climb above the cup lip again.That happened on May 9, his girlfriend's birthday. Sensing a positiveomen, he made a notation to buy the stock, on paper, at the closing price thefollowing day (filled at 15'A). When he met his girlfriend the next day, she was
not impressed with the birthday present he gave her, and the stock closedlower as well.
Two weeks later, the stock was moving up. Cody placed his stop H belowthe handle low, at 143/s (point D, which also marks the purchase point). Whenthe stock climbed above the outer cup, he raised the stop to Vs below the handle low or 17'/2. Then, he noticed a problem forming: a right-angled broadening top formation. To him that was a bearish signal, so he moved his stop up
to just below the base at 20J/4. Then he waited.He got word that the stock was in trouble from his pals. They were not
too happy with the company for some reason. When he pulled the stock up onhis computer screen, he noticed that it had hit his stop in late August when
RESULTS SNAPSHOTAppearance
An upward bounce and a declining price trend followa dramatic decline.
prices momentarily dipped. Cody whipped out his calculator and tallied up hisgains. He made $5 a share for a gain of over 30%. He chuckled to himself that
Reversal or consolidation
Long-term (over 6 months) bearish reversal
Failure rate
10%
next time he would use his paper profits to buy his girl something other than
Event decline
25%, with most likely decline being 20%
Postevent decline
15%, with most likely decline between 5% and 25%
Surprising findings
The larger the event decline, the larger the bounce.The larger the event loss, the quicker die bouncereaches its high.
cubic zirconium.
If you trade stocks long enough, you will probably run across this puppy: the
dead-cat bounce. (I could not resist the pun). It is not so much a chart formation as it is a warning to exit the stock quickly after a dramatic decline.
The event decline, which is the