"Cypher" Harmonic Pattern Still in Play for BTCUSD
Updated
The rules are:
1.) for XAB, B must retrace (downward for bullish cyphers) between 0.382 (38.2%) and 0.618 (61.8%) of XA.
2.) for ABC, C must retrace (upward for bullish cyphers) between 1.13 (113%) and 1.41 (141%) of AB.
3.) for BCD, D must retrace (downward for bullish cyphers) between 1.272 (127.2%) and 2.0 (200%) of CB, and also 0.786 (78.6%) of XA.
4.) D completes at 0.786 of XA and, as long as the other conditions are met, this constitutes a "potential reversal zone" (PRZ)
5.) Traditionally there are two trades that are entered at point D, both with a stop a few ticks below point X, while one targets 0.382 of AD and the other targets 0.618 of AD.
You can see that all these conditions are met for the harmonic pattern that is drawn out on the chart and the two trades are also set up according to the above rules.
To be clear, the pattern doesn't complete unless BTC's price drops to the PRZ (at point D), around 33k, without first invalidating the pattern (trading above 141% of AB @ point C).
1.) for XAB, B must retrace (downward for bullish cyphers) between 0.382 (38.2%) and 0.618 (61.8%) of XA.
2.) for ABC, C must retrace (upward for bullish cyphers) between 1.13 (113%) and 1.41 (141%) of AB.
3.) for BCD, D must retrace (downward for bullish cyphers) between 1.272 (127.2%) and 2.0 (200%) of CB, and also 0.786 (78.6%) of XA.
4.) D completes at 0.786 of XA and, as long as the other conditions are met, this constitutes a "potential reversal zone" (PRZ)
5.) Traditionally there are two trades that are entered at point D, both with a stop a few ticks below point X, while one targets 0.382 of AD and the other targets 0.618 of AD.
You can see that all these conditions are met for the harmonic pattern that is drawn out on the chart and the two trades are also set up according to the above rules.
To be clear, the pattern doesn't complete unless BTC's price drops to the PRZ (at point D), around 33k, without first invalidating the pattern (trading above 141% of AB @ point C).
Note
Getting close to triggering a trade!
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