Harmonic Patterns

Harmonic Patterns where created by H.M. Gartley in 1932. He is well known for Gartley harmonic pattern.We will examine in depth basic and more patterns in this article.

The concept of Harmonic Patterns was established by Harold McKinley Gartley in 1932. Gartley wrote the famous Gartley pattern.After H.M gartley some other traders enchanced his technique.Larry Pesavento introduce Fibonacci into patterns and later some new patterns where created.

HARMONIC PATTERNS are based on market price movement symmetry.We will examine the following patterns in depth. Gartley Bat Butterfly Cypher Crab Shark 3 Drives AB=CD 5-0.

Gartley Pattern.

Gartley patter is made from 5 basic points.All points are based on fibonacci sequence.Pattern can reveal a reverse in price action or a continuous.

XA is the first movement we can pick at any point in chart.AB is the retracement of first move ideally at 0.618.BC the next move is the retracement 0.382 to 0.886 of the AB move.Finally CD is the 0.786 retracement of XA(first leg).

Depending of pattern traders can buy or sell at D point.

We know that for a first time trader identifying and drawing the pattern is really hard.This is why there are ready harmonic indicators so identifying is automatically implemented.

Beside that a trader must know how to deal with harmonic patterns.Lets investgate real trading cases.

Bullish Gartley Bearish Gartley

Example 1