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Harmonic Patterns

Gartley patternHow to Trade when you see the Gartley Pattern? What to consider to enter the trade? To enter a Gartley trade you should first take note of the pattern and then confirm if it is valid or not. Outline the four price swings on the chart and check to make sure they respond to their respective Fibonacci levels to draw the Gartley pattern on your chart. Ensure you mark every price action swing with the important letters X, A, B, C, and D. By doing this, you will be able to estimate the overall size of the pattern and get a clear idea about the parameters. If your chat is a bullish Gartley, open a long trade after noticing these conditions: CD gets support at 127.2 percent or 161.8 percent Fibonacci level of the BC move. The price action bounces in a bullish direction from the respective Fibonacci level. If the Gartley pattern is bearish, then you make use of the same two rules to open a trade. But in this case, your trade will to the short side. Where to set your stop-loss for a Gartley trade? It is always recommended that you use a stop loss order regardless of your preferred entry signal. By doing this, you will be protecting yourself from any rapid or unexpected price moves. The stop loss order of a bullish Gartley trade should be found below the D point of the chart pattern. But for a bearish Gartley trade, your stop loss order should be found above the pattern’s D point. What to aim for your take profit for a Gartley trade? When you open your Gartley trade and you place your stop loss order, you expect the price to move in your favor, right? And if and when it does, you should know how long you expect to stay in the trade. It is advisable to enter a full position after the D bounce and then scale out at different levels when trading a Gartley harmonic pattern. If the price momentum continues to show signs of strength, you can opt to keep a small portion of the trade open so as you can catch a large move. Use price action clues such as trend lines, support and resistant techniques, candle patterns and trend lines to find the right final exit point. But generally, if the price action shows no signs of interrupting the new trend, just stay in it for as long as you can.
FTSEMYX:FBMKLCIEducation
by manjoiboyz
1
Crab and Deep Crab harmonic patternHow to trade when you see the pattern? Trading a bearish Crab pattern To trade a bearish crab pattern, put a short (sell) order at point D (the 161.8 percent Fibonacci extension of the XA leg). Entry: Identify where the pattern will end at point D, and place your order Stop-Loss: Put your stop-loss just below point D Take Profit: The location of your profit target is highly subjective and depends on your objectives and market conditions. If you desire aggressive profit, place it at point A of the pattern. For a more conservative profit, place it at point B. Trading a bullish Crab pattern First of all, choose the crab pattern charting tool and follow all the above rules to identify the pattern. Remember that the Fibonacci ratios are very important to trade the crab pattern. If you notice the pattern on a price chart and if you find the ratios not matching with the pattern rules, it means that the pattern is not valid. So do not trade that pattern. When the price action confirms the pattern, immediately enter for a buy. If you are a conservative trader, ensure you wait for a couple of bullish confirmation candles before entering the trade. There are four targets (X, B, C, A) to place the take-profit order in the crab pattern. At the start, traders try to book full profit at point A, but when the price crosses point B, the market turns sideways. So book half of your profit at point B and then close your full positions at point A. Most of the traders placing their stop-loss way below point D; however, that’s a wrong way to do it because they are risking more due to this simple logic. If the price action breaks point D, it automatically invalidates the pattern.
FTSEMYX:FBMKLCIEducation
by manjoiboyz
Cypher patternHow to trade when you see the Cypher pattern? While trading the cypher pattern, you will apply a set of simple rules. They will try to minimize risk and maximize profits. Even though there is one more important step to learn before defining the cypher pattern trading strategy rules. Step 1: Drawing Cypher patterns Click on the harmonic pattern indicator located on the right-hand side toolbar of the TradingView platform. Identify the starting point, X, on the chart, which can be any swing low or high point. Once you’ve located your first swing high/low point, follow the market swing wave movements. Every swing leg has to be validated and abide by the cypher pattern forex Fibonacci ratios. Step 2: Trading process Now that you know how to identify and qualify the harmonic cypher pattern, it’s time to trade the pattern. Standard methods of trading the cypher pattern include: Entry point The cypher pattern may be the most exciting harmonic pattern for risk management, because it has the highest winning rate. Backtesting results have continuously proven the cypher pattern forex is a very dependable harmonic pattern. Next, buy with a market order at the first candle preceding the completion of the D point at 0.786 Fibonacci retracement of the XC leg. Once the market touches the 0.786 level, wave D is in place, because you can’t control how far the market will go. When the CD leg gets to the 78.6 percent retracement level, the cypher pattern is complete and valid. However, the 78.6 percent Fibonacci retracement level of X to C also acts as the standard entry point for a valid cypher pattern trade. Take profit There are some ways to take profit with this pattern, but the standard method is to scale out of your position at the first take profit level and end the trade at the second take profit level. Take profit once you get to point A. To get to such levels, draw a Fibonacci retracement of the CD leg. The cypher patterns trading method is a reversal method. Make sure you capture as much as possible from the new trend. If you’re not a fan of reversal strategy, and you prefer a trend following strategy, follow the MACD trend following strategy-simple to learn another strategy. The strategy has attracted a lot of interest from the Forex trading community. Ensure you take profits once you reach point A of the pattern, because it has conservative take profit target. So, why should you take profit so early? For the most part of the harmonic patterns, it’s best to lock in profits as soon as possible. Since the cypher pattern is one of the most profitable harmonic patterns, you can give it more room for the price action to breath. You have the chance to at least see a retest of the wave A. Stop-loss Ensure you give your trade at least 10 pips space above X in the intraday charts. While trading a bullish cypher pattern, place the stop-loss at least 10 pips lower than the low of X. For a bearish pattern, place the stop-loss at least 10 pips higher than the high of X. That’s the only logical place to hide your stop-loss, because any break below will automatically invalidate the trade.
FTSEMYX:FBMKLCIEducation
by manjoiboyz
Shark patternHow to trade when you see the Shark pattern? The ideal method used to trade a shark pattern is quite different from that used for other chart patterns. The take profit can be at 50 to 61.8 percent of BC . The way to trade this pattern is to go in at the open of the next candlestick after the harmonic indicator has detected the pattern. As soon as the C-leg forms, enter the market with a protective stop-loss at the 2.618 extensions of AB swing-leg. Drawing the pattern Click on the indicator of the harmonic pattern which can be found on the right-hand side toolbar of the platform Determine on the chart the starting point 0, which can be any swing high or low point on the chart After locating the first swing high/low point, follow the market swing wave movements Traders need to have 4 points or 4 swings high/low points that join together to form the harmonic crab pattern strategy. Each swing leg has to be validated and stick to the Fibonacci ratios of the shark pattern forex. Trading the pattern Buy at point D, which has to satisfy the requirement CD = 1.13 OX segment. The D to X can be found anywhere between 0.886 to 1.13, but it is best to take trades using an ideal 1.13 extension. Stop-loss The stop-loss can be placed below the 1.150 Fibonacci extensions of XA at point C. As the market begins to go towards the first take profit, move it after D leg. This is the best place to hide the stop-loss because any break below will automatically invalidate the Fibonacci requirements for a shark pattern. Just as it is with any new pattern, you need to be cautious when trading this pattern. You should only trade the best price structure that fits into all the Fibonacci ratios with great precision. Be picky! The shark harmonic trading strategy works very well as a strong counter-trend strategy.
FTSEMYX:FBMKLCIEducation
by manjoiboyz
Bat harmonic patternHow to trade when you see the Bat pattern? Before trying and trading the pattern, confirm from this checklist that the pattern is real. It should include these vital elements: An AB=CD pattern or an extension of this pattern An 88.6 percent Fibonacci retracement of the X-A leg A 161.8 to 261.8 percent Fibonacci extension of the B-C leg Next will be to look at how traders can trade using the bat pattern. We will make use of the bullish bat pattern as an example. For a bearish bat pattern, simply do the opposite for your orders. The first thing to look for when looking for this pattern is the impulsive leg or the XA leg. We are trying to identify a strong move up or down depending if we either have a bullish bat or a bearish bat pattern. The next thing that needs to be satisfied for an authentic bat pattern structure is a minimum 0.382 Fibonacci retracement of the XA leg and it can go as deep as 0.50 Fibonacci retracement of the XA leg, but it cannot break below the 0.618. This will form the B leg of the pattern. The next thing traders should do is to look for a retracement of the AB leg up to at least 38.2 percent Fibonacci ratios, but it cannot exceed the 88.6 percent, and this will form the third point C of the pattern strategy. The last thing to do is to establish is the D point, and to get to the D point, find the 0.886 Fibonacci ratios of the impulsive XA leg, which will lead to a deep CD leg, and finally, it will complete the entire structure of the pattern. Market strategy The market strategy of the pattern has been tested across various classes of assets (commodities, currencies, stocks, and cryptocurrencies). It is recommended that traders should take the time and back-test the bat harmonic patterns strategy before using this advanced pattern for trading. Step 1: Drawing the pattern Begin by clicking on the bat pattern indicator that is found on the right-hand side toolbar Identify the beginning point X, which can be any swing high or low point on the chart After identifying the first swing high/low point, simply follow the market swing wave movements You should get 4 points or 4 swings high/low points that join and form the harmonic bat pattern strategy Step 2: Trading the pattern The 88.6 percent Fibonacci ratio provides traders a more reliable risk/reward ratio which is why the market strategy of the bat pattern is such a very popular as a market strategy. The best entry point is the 88.6 percent Fibonacci retracement which is a very accurate market turning point. It is recommended that traders should enter as soon as they touch the 88.6 percent figure. Oftentimes the harmonic bat pattern strategy doesn’t go much above this level. Step 3: Placing a stop-loss Usually, traders should place their protective stop-loss lower than the point X of a harmonic bat pattern. That is the only logical location to hide the stop-loss because any break below will automatically invalidate the pattern. Step 4: Take-profit margin There can be several ways to manage your trades, but the best target for this pattern should be to use a multiple take profit formula. For this pattern strategy, take the first partial profit once you hit wave-C level and the remaining half once we break above wave-A. By doing this you will accomplish two things: first, you’ll ensure that you accumulate profits, and secondly if the markets reverse, you ensure you’re stopped at BE and don’t lose any money.
FTSEMYX:FBMKLCIEducation
by manjoiboyz
Alternate Bat harmonic patternWhat is the Alternate Bat harmonic pattern? The alternate bat pattern is a variation of the Gartley pattern. Scott Carney developed it in 2003. It is popular for incorporating the 1.13XA retracement as the defining element in the Potential Reversal Zone (PRZ). The alternate bat harmonic pattern is one of the most precise trading patterns that works exceptionally great in the relative strength index (RSI) BAMM set up. How to identify the Alternate Bat harmonic pattern? The alternate bat is a unique trading pattern that involves certain precise measurements. Those measures are crucial in order to identify the alternate bat. A pattern must meet the following conditions to be an alternate bat pattern: The first important factor is the B point retracement that must be 0.382 retracements or it must be less of the XA leg. The alternate bat only utilizes 2.0 BC projections or greater than that. The AB = CD pattern within the alternate bat pattern always extends requiring a 1.618 AB = CD calculations. Generally, the best structures use 50% retracement at the midpoint.
FTSEMYX:FBMKLCIEducation
by manjoiboyz
Butterfly patternHow to trade when you see the Butterfly harmonic pattern? Before trading the butterfly harmonic pattern, confirm from the following checklist that the pattern is real. It should have the following vital elements: AB= an ideal target of 78.6 percent of XA leg BC= minimum 38.2 percent and maximum 88.6 percent Fibonacci retracement of AB leg CD= Is a target between 1.618 to 2.618 percent Fibonacci extension of AB leg between 1.272 to 1.618 of XA leg Entry point Determine the place where the pattern will complete at point D – this will be at the 127 percent extension of the X-A leg. Stop-loss Put a stop-loss just below the 161.8 percent Fibonacci extension of the X-A leg. Take profit target The location for placing a take-profit target with this pattern is very subjective and depends on your trading goals as well as the conditions of the market. To have an aggressive profit target, put it at point A of the pattern. For a more conservative profit target, put it at point B. Trading a bearish butterfly harmonic pattern Place the sell order at point D (a 127 percent extension of the XA leg). Position the stop-loss right above an extension of 161.8 percent of the XA leg. And place the profit target at A for an aggressive move at B for a defensive move. Trading a bullish butterfly harmonic pattern Determine the end of the pattern at point D, which is an extension of 127 percent of the XA leg. You need to put a buy order at this point. Now, below a Fibonacci extension of 161.8 percent of the XA leg, a stop-loss can be placed. Placing a profit target depends on both market conditions and your trading goals.
FTSEMYX:FBMKLCIEducation
by manjoiboyz
📚13 Topics You MUST Study in Trading👨‍🎓👩‍🎓 Hey traders, I receive dozens of questions each and every day concerning the topics to study to become an expert in technical analysis. Here I have collected the main subjects that, in my view, are essential for successful trading. *the order of the topics is spontaneous and there is no logical sequence 1️⃣ - Candlestick patterns To me, candlesticks are very important for understanding market behavior. A single wick quite often can tell you a story. Mastering different candle stick patterns, you will be impressed by how much data and information you may derive from analyzing them. 2️⃣ - Price action patterns At first glance price chart is complete chaos. The market looks irrational and it feels like there is no way to read it. Price action patterns are the language of the market. With them, the price fluctuations start to make sense. 3️⃣ - Support & resistance All my predictions, all my trades & signals are always based on support & resistance levels. These are the levels that make the market change its direction, they influence the market so much, therefore you should learn to identify them and constantly hold them on focus. 4️⃣ - Supply & demand zones The only difference between support & resistance and supply & demand zones is the fact that the first ones are represented as levels while the second ones are represented as the zones. The identification of these zones is very important for proper market analysis. 5️⃣ - Key levels Key levels are the strongest supports and resistances. Of course, spotting various supports and resistances on the chart, we can not say that they all are equal in their significance. There is a strong (however subjective) hierarchy of them. The most significant are called key levels and from them, the most significant moves are always expected. 6️⃣ - Trend analysis When I teach my students how to analyze the price chart, I always start with a trend analysis topic. Knowing where exactly the market is going, having specific and objective rules for the trend identification are necessary for successful trading. 7️⃣ - Top-Down analysis Multi-time frame analysis is my passion. I am constantly combining the signals & observations from different time frames to make my trading decision and predict future market moves. It proved to be a very efficient method of trading various markets. 8️⃣ - Financial instruments Though to many it may sound obvious, in practice I know that a lot of people are struggling with a simple question "What to trade?". You must learn to properly build your watchlist and you should have strong reasoning behind the selection of each unite that is inside. 9️⃣ - Trend following trading As we know, the trend is our friend. And even though the phrase itself is very simple and straightforward, it takes so much effort and time to learn to follow the trend properly. 1️⃣0️⃣ - Counter trend trading Occasionally the market reverses. Properly identifying early reversal signs and then catching a sharp counter-trend move, huge profits can be made. Even though such a style of trading is considered to be extremely risky, being applied properly will generate a lot of cash. 1️⃣1️⃣ - Risk management Losses are inevitable. They are part of the game and we can do nothing about that. The only thing that we can do, however, is to control the losses. Calculating the risk for every single transaction is essential to avoid a margin call. 1️⃣2️⃣ - Leverage trading Leverage selection, margin are the things that are tightly connected with risk management topic. These are the terms that you must know how to operate with. 1️⃣3️⃣ - Trading psychology Playing with real money, occasionally losing significant portions of your trading account can be a tough game. It takes time to build a strong psyche to deal with the irrationality of the market. Which topic to start with? Pick any, learn it, study it. They all are equally important so at the end of the day you need to cover them all in order to become successful. ❤️Please, support this idea with a like and comment!❤️
Editors' picks
Education
by VasilyTrader
105
CAD/JPY Short - 01 June 2021 | Hybrid Move Result: +3.00%Hey all, Another quick breakdown of a Hybrid setup taken this month.. The trade initiated from a Sr. Daily Zone which was created all the way back in January 2018, where price showed a beautiful trendline break and a huge crash in price. Overall the monthly time-frame was sitting at major value as well together with the weekly chart being in need of a reversal after the strong 2020 and 2021 volatility in the markets. The 4hour started to top out here after the daily showed a clearly over-extended run. When the double top formed at the 4hour chart, price confirmed the bearish bias with a clean 4hour star formation to the downside and a clean move later on. The orange candles at my chart are from our unique entry indicator developed to be optimal for our supply and demand zones. If you have any questions, feel free to comment below! Kind regards, Max Nieveld
Education
by newcapitalfx
BTC - Harmonic Patterns pt.1 'THREE DRIVES PATTERN' (beginners)You may be wondering why you keep losing money in the markets. Well, we've all been there - more often than we wished for. But we asked for it every single time. So, why is that? After years of repeatedly or constantly losing money, I know very well what I've been doing wrong for so long. I came to the conclusion that I - and most people I observed or know in person - keep losing money because of several factors, one of which I will elaborate in this sheet: The absence of a system Many people, who are new to the world of trading and investing, especially those who have suffered (severe) losses in the past, are drifting around, clueless, and are seeking for a helping hand that is supposed to guide them around in the world of making and losing money. That state of helplessness and the general accessability of the internet and social media is the perfect playground for fraud. Since there has been a wave of fake (marketing) gurus all over the internet for quite a while, that many fell victim to, the term 'system' is now broadly misunderstood and causes fear among those who were scammed by 'THE MAGIC AND ALWAYS WORKING SYSTEM'. Usually 'gurus' on the internet charge money for providing a system or pretending to educate people about how to 'REALLY' make money. So what is a system? Before finally adopting or developing a system, one must know what a system is defined by, and what criteria a system has to meet. So what does a system do? A system is supposed to allow one to evaluate more or less reliable entry points/levels. But what does that mean? It means that you don't want to participate in EVERY major move the markets offer you to be part of. In fact a system will focuse on a very specific kind of moves, and you are only supposed to trade/invest according to the potential entry that the system you use provided. You will most likely miss out on many moves, and you will think about the amounts of money you could have made if you had just been part of that one major move that you can't stop thinking about. That thought-process is self destructive though, and will lead to suffering even more losses because most people force themselves to not miss out on the next move, in order to finally be part of the wave that makes the real money. But what defines a proper system? How do you know it works? Well, there is only one way to find out. One who sticks to a system - or several - would only want to take the entries the system provides for them, regardless of what happens outside of their system's frame. And yes, that means missing out on many, many, and many more major moves. However, atually making money by applying a system leads to 'strategy building', which focuses on, or consists of 'money management' and 'risk management'. That is a whole other topic though, which I am looking forward to explaining in further educational posts, but not in this one. A system is supposed to allow you to evaluate ONE specific entry, according to specific conditions that have to be met. In order to allow you to pick up on what I'm trying to say I have prepared a very simple example of a system (also referred to as 'technique'). Since many people wanted to be part of the crypto-spikes that we have recently seen, and bought coins at all time highs, I decided to demonstrate several harmonic techniques on the BTC chart. First of all: Where are we? Where is the example taking place? For having a better idea about the scale and location I added this snapshot of the BTC chart in the daily timeframe: (ALL FOLLOWING SNAPSHOTS WERE TAKEN IN 13H TMF) A system, or technique, may be very simple. The strategy your system will be part of will be more complex. But the system itself may surprisingly be very simplistic. For instance: I have been trading with the use of 'harmonics' for a very long time. I focused on TWO different types of harmonic patterns. 1) AB=CD patterns (ABCD) 2) Three Drives patterns In this case, you could make use of the examples I will provide in a second in two different ways, since they'd have given away a short signal on BTC at the ATH. 1) actually shorting BTC, which isn't a very popular method, since not many brokers offer the ability to short sell crypto currencies, and if they do, it often is very expensive to execute. However, some still do it, and this would've been a perfect entry for a short order. 2) interpreting it as a warning signal to either a) getting out of BTC or to b) not buying more coins. I'll introduce the 'Three Drives pattern' in this post, because it was a very clean, textbook-like pattern in this specific case: So, this is the pattern I have spotted that the BTC ATH (all time high) consists of/portrays. As I have mentioned several times already, a system shall provide an entry. So, only if the requirements are met, you are allowed to make a trade. Since some of you may be unaware of what a three drives pattern is, and how to trade it, i will break it down for you: A three drives pattern is a series of lower lows or higher highs which occur in a very specific relation to each other and usually indicate the market may turn around after completing the pattern. It focuses on analysing the time/price relation between said highs or lows. In detail: It consists of three drives, as the name gives away, which may be a series of three consecutive higher highs, or lower lows: bearish: bullish: each drive is interconnected with a corrective move, the corrective moves will play a very decisive role in determining the entry. bearish: bullish: The numbers (1.27) that the three drives pattern, that Tradingview offers, already includes, measure the price excess of the correction move in relation to the next high. In order for the trade to be executed the price excess must either be 1.27 or 1.618 (1.62 approx.). If you're uncomfortable with the three drives drawing tool you could simply measure it by yourself using a fibonacci retracement featuring the 1.27 and 1.618 extensions and apply it on the corrective moves of the three drives pattern, just like this: The following drive should then bounce off the 1.27 or 1.618 extension. You must apply the Fib rectracement on the second correction wave too. The end of the 3rd drive, which should bounce off the 1.27 or 1.618 extension too would then initiate the trade. You would SIMPLY (according to this system) make a trade. All that you have to do is to find a system that has proven to work out to a certain degree in the past (always do never ending backtesting), implement it in your strategy (risk-, and money management) and strictly take the entries that your system provides for you. A system is supposed to give you the confidence you need to blindly execute it according to its rules and requirements. The only way to gain said confidence is to a significant amount of backtesting over and over again, and literally studying the system. A trade that you are afraid of to take, for whatever reason, can still be interpreted as a strong signal to close your current positions, as in the case of this BTC example. Not many people would dare to simply short BTC on the ATH, but relatively many people would probably start takeing profits or selling their coins if they spotted a short entry - according to whatever system(s) they may use. There is not THE perfect system out there. Find a system you can apply confidently and implement it in your strategy. Now, the remaining question is where to take profits once you're in. The Three Drives pattern offers several take profit levels. There may be other ways to successfully take profits, but this is the way that has proven to be the most profitable one for me: I usually simply attach a FIB retracement to the end of the first correction move and to the end of the 3rd drive , and I take partial profits at each of these marked levels. (0.382; 0.5; 0.618; 1.0; 1.27; 1.618). Back to the REAL example: the entry: the take profits: While there are many ways to apply or trade the Three Drives pattern, and some focuse on the retracements in specific, while I focuse on the extensions of the correction moves only. I don't pay much attention to the retracement level of the correction moves because there simply isn't a reliable retracement level. Some fall back to 0.382 while others retrace as far as 0.618 or 0.786. The issue with trading and investing is, that one's ANALYSIS is one thing, but actually initiating a trade, spotting the chance of making money in time and not hesitating to take action is a whole other thing. The only way to act with confidence when the time has come and to actually making the trade is to apply a system that has PROVEN to work. If you don't have a system you won't have the guts to take the chance for a good trade because you burned your hands in the past. Focuse on the entry. Not on where prices may go in the future. If you got your entry right, you can take profits wherever you want to. An analysis doesn't make money. The trade does. The market may do whatever, no one knows what tomorrow will bring, so focuse on the only thing you can influence: The entry and the risk that comes with it. And take profits. Especially in these times. Whatever it is that you do, may it be automated or manual trading, the only way to prove a system is working, is to backtest it. Over and over again, on hundreds or thousands of examples. Thank you for taking the time to reading this rather complex and long article. Cheers ;)
COINBASE:BTCUSDEducation
by AlphaTradingGermany
2
Technical Analysts already knew that Bitcoin will dump! Head and Shoulder Often considered the most steadfast of all major reversal patterns, the Head and Shoulders chart pattern is employed by novice and experience traders alike to speculate on both forex and stock markets. The benefit of this chart pattern is defined areas to set risk levels and profit targets. The inverse (reverse) head and shoulders pattern is equally useful in any trader’s arsenal and adopts the same approach as the traditional formation. This pattern already notified us of BITCOIN DUMP. Also, I earned a lot from Bitcoin because of Support and Resistance. SUPPORT & RESISTANCE + Trading Pattern = Best Combination =>> Profit$$
COINBASE:BTCUSDEducation
by tradethrill
📚 Supply Zones: How to Identify and trade them?Hello Traders. Welcome to this Post about How to properly Draw and trade demand levels. In this post first post we will talk about how to draw it. if you can memorize the simple methodology, then you can start applying more advanced theories on top of them! Make sure to follow for more content Frequent Questions : How to Draw a Supply level ? When to Know when we have a valid demand Level? and Invalid level When a Supply level is invalidated? When to execute a trade in a valid area? ----- How to Draw it ? You just need to start with current price on the chart . Then look left and down until you find the origin of a very strong drop in price. Understand that behind every drop and strong mouvement someone is behind leaving a footprint. Identify the base and mark it from the messy top of the base to the extreme bottom. When to Know when we have a valid demand Level? Rules: When you have a very strong bearish monthly structure , supply levels tend to be accurate a stronger. In downtrend they are valid but less accurate. By other side we like to trade the first retest. The more a zone is being tested the less accurate it becomes. When to execute a trade in a valid demand area? → It is possible that price retest the zone. If that happens , from my experience you need to combine multiple factors. One of the most important is the fundamental. when you have a strong fundamental trend confirmed , then a pullback into a supply level in a strong downtrend structure is valid. By other side when you have valid micro signals in a valid macro sell zone then, probably price will be using the supply level to continue to the upside. When a Supply level is invalidated? ❗The purpose of Supply levels are to push the price to the downside. in that way a supply level is invalidated when price cross beyond the base . By other side if price consolidate a lot in a strong supply level and slowly start to break the zone keep in mind that the price can slide up and totally invalidate the supply zone . make sure to only trade the first retest of the zone. Never trade MULTIPLE retests ❗Watch out for the big time frames trend I hope this Educational Post was helpful . Make sure to follow and let me know in the comment section if you trade supply and demand ? have a nice day!
Education
by AIRFOREXONE_
11
How To Use Bearish Wolfe Wave SetupThe key to recognizing the Wolfe Wave setups is symmetry. Ideally, waves 1-3-5 are established with very regular timing intervals between moves. The other key ingredient is that the wave 4 should revisit the price range established by waves 1-2 for the best results. Another way to describe the pattern is that it comes as a rising wedge / channel in an uptrend, or falling wedge / channel in a downtrend. Wave 5 is often a false breakout move beyond the bounds of the pattern. Unlike either bull or bear flags, the movement is in the same direction as the overall trend, with the overlapping waves giving signals that an impending reversal is taking shape. This pattern has different names, depending on the source - Larry Pesavento describes the pattern as "3 pushes to a top/bottom" and uses Fibonacci relationships to confirm the setup (waves 3 and 5 are 127% or 162% extensions of the previous pullback.) Jeff Cooper uses "Cooper 1-2-3 swing" nomenclature, and Linda Raschke likes to call this setup "3 Indians". The unique quality about wolfe waves, however, is the objective target projection from waves 1 -> 4
Education
by Anbat
1