XABCD Pattern

- Basic Structure:
- Five control points (X, A, B, C, D)
- Four connecting legs (XA, AB, BC, CD)
- Each point represents significant price high or low
- Adjacent legs move in opposite directions
- Identified Patterns:
Four major harmonic patterns with bullish or bearish variations:
- Gartley
- Butterfly
- Crab
- Bat
- Usage:
- Manually position five points at key swing highs/lows
- Adjust points to match specific pattern requirements
- Analyze potential reversal zones
- Identify potential price targets
- Customization:
- Adjust point positions
- Change line properties
- Modify pattern colors
Cypher Pattern

- Origin: Developed by Darren Oglesbee
- Structure: Five key points (X, A, B, C, D) forming four legs
- Key Feature: Highly accurate Potential Reversal Zone (PRZ)
Pattern Structure
- XA leg: Initial price movement
- AB leg: First correction after XA move
- BC leg: Price movement following the correction
- CD leg: Final move to the reversal point D
- PRZ (Potential Reversal Zone): Located in XD region with Fibonacci ratio 0.768-0.886
Pattern Variations
- Bullish Cypher:
- Forms an M-shaped pattern
- Indicates upcoming uptrend after correction
- Entry point at D for long positions
- Bearish Cypher:
- Forms a W-shaped pattern
- Signals beginning of downtrend after temporary rise
- Entry point at D for short positions
Identification Tips
- Use Fibonacci tools to confirm ratio relationships
- Look for precise geometric formations
- Confirm with additional indicators at point D
- Watch for reversal candlestick patterns at PRZ
Head and Shoulders Pattern

- Left shoulder
- Head (central peak/trough)
- Right shoulder
- Neckline (horizontal support/resistance)
- Bearish Head and Shoulders:
- Forms at market tops
- Signals upcoming downtrend
- Head higher than both shoulders
- Bullish Head and Shoulders (Inverse):
- Forms at market bottoms
- Signals upcoming uptrend
- Head lower than both shoulders
- Previous Trend: Must form after established trend
- Left Shoulder: Initial peak/trough with high volume
- Head: Higher peak (or lower trough) than shoulders
- Right Shoulder: Similar height to left shoulder
- Neckline: Connecting line of support/resistance
- Volume: Typically decreases throughout formation
- Price breaks neckline after right shoulder
- Bearish: Break below neckline
- Bullish: Break above neckline
- Often accompanied by volume increase
ABCD Pattern

- Four control points (A, B, C, D)
- Three connecting legs (AB, BC, CD)
- Adjacent legs move in opposite directions
- Points mark significant highs and lows
- First leg (AB): Initial price movement
- Second leg (BC): Retracement of first move
- Third leg (CD): Final move to completion point
- These three legs combine to create recognizable price structures that signal potential reversals
- AB=CD Pattern:
- Distance of AB approximately equals CD
- Time duration of AB similar to CD
- Creates symmetrical price movements
- Signals potential reversal at point D
- Classic ABCD:
- CD leg extends 127.2% or 161.8% of BC leg
- Uses key Fibonacci extension levels
- Often forms in trending markets
- ABCD Extension:
- CD leg extends 127.2% or 161.8% of AB leg
- Focuses on relationship between first and last legs
- Potentially stronger reversal signals
Triangle Pattern

- Basic Structure:
- Four control points (A, B, C, D)
- Points placed on alternating highs and lows
- A and C on consecutive highs (or lows)
- B and D on consecutive lows (or highs)
- Creates converging trendlines
- Triangle Variations:
- Symmetrical Triangle:
- Support and resistance lines converge with similar slopes
- Both lines move toward a central apex
- Generally considered a continuation pattern
- Expected breakout in direction of previous trend
- Unexpected breakout direction signals potential trend reversal
- Ascending Triangle:
- AC line forms flat resistance
- BD line forms ascending support
- Bullish pattern suggesting upward pressure
- Expected breakout above resistance line
- False breakouts possible below support line
- Descending Triangle:
- BD line forms flat support
- AC line forms descending resistance
- Bearish pattern suggesting downward pressure
- Expected breakout below support line
- False breakouts possible above resistance line
- Symmetrical Triangle:
Three Move Pattern

- Basic Structure:
- Five key points creating three drives and two retracements
- Three drive points (1, 2, 3) following the trend direction
- Two retracement points (A, C) moving counter to the trend
- Complete pattern signals potential trend reversal
- Pattern Requirements:
- Symmetry: Both price movements and time duration must be proportional
- Extensions: Drives 2 and 3 should extend 127.2% or 161.8% of retracements A and C
- Retracements: Points A and C typically retrace 61.8% or 78.6% of previous drives
- In strong trends, may only retrace 38.2% or 50%
- Time Symmetry: Horizontal distance between points should be approximately equal
- Pattern Variations:
- Bullish Three Drives:
- Drives move downward with trend
- Final drive signals potential upward reversal
- Bearish Three Drives:
- Drives move upward with trend
- Final drive signals potential downward reversal
- Bullish Three Drives:
Elliott Impulse and Elliott Correction
A systematic approach to market cycles based on Ralph Nelson Elliott’s wave theory:- Basic Concept:
- Markets move in predictable, repeating wave patterns driven by human psychology
- The fundamental pattern consists of 8 waves (5 impulse waves followed by 3 corrective waves)
- These patterns appear at all scales, from minute-by-minute charts to multi-year trends
- Elliott discovered that larger waves contain smaller waves with the same structure (fractal nature)
- Wave Classifications:
- Elliott Impulse (Motive Waves):
- Move in the direction of the main trend
- Consist of five distinct waves labeled 1-2-3-4-5
- Generally stronger and longer than corrective waves
- Create the primary movement in the market
- Elliott Correction (Corrective Waves):
- Move against the main trend direction
- Consist of three distinct waves labeled A-B-C
- Typically retrace a portion of the preceding impulse wave
- Often more complex and difficult to identify than impulse waves
- Elliott Impulse (Motive Waves):
- Elliott Impulse Structure (5 waves):
- Wave Structure: Each impulse consists of 5 waves, with waves 1, 3, and 5 being impulses themselves, and waves 2 and 4 being corrections
- Wave 2 Limitation: The second wave never retraces more than 100% of wave 1 (never goes beyond the starting point of wave 1)
- Wave 3 Extension: The third wave always moves beyond the end of wave 1, often the longest and strongest wave
- Wave 3 Prominence: Among waves 1, 3, and 5, wave 3 is never the shortest and frequently the longest
- Wave 4 Boundary: The fourth wave typically doesn’t enter the price territory of wave 1 (no overlap)
- Elliott Correction Structure (3 waves):
- ZigZag Formation: The most common corrective pattern is a zigzag structured as 5-3-5 (five waves down, three waves up, five waves down in a bearish market)
- Wave B Characteristics: Wave B is typically shorter than wave A, showing the underlying strength of the main trend
- Wave C Extension: Wave C usually extends beyond the end of wave A, creating a new extreme in the correction
- Wave Hierarchy Notation:
- Main Waves: Marked as (1), (2), (3), (4), (5), (A), (B), (C) showing the larger degree pattern
- Sub-waves: Marked as 1, 2, 3, 4, 5, a, b, c representing smaller waves inside the main waves
- Analysis Scope: The pattern typically examines 600 previous bars to identify wave structures