Harmonic Patterns discussion 🔥 🚀

[BennyThadikaran]

I was reading up on Harmonic patterns last few days. Its best to start with the AB = CD pattern. This seems like the most basic pattern and will establish the base code for all other patterns. You can check out the actual pattern and its description at this link https://harmonictrader.com/harmonic-patterns/abcd-pattern/

Below is how the pattern will be plotted on charts.

• Green line indicates direction of entry. (Its not the suggested entry price).
• The pattern is detected
  • if the C pivot is formed within 0.382 and 0.886 retracement of AB leg.
  • D pivot (the last Close) is below the B pivot.

The two red lines are the 1.13 and 2.618 FIB extension of the AB leg. Optionally an added line indicating where AB=CD line must end.

Idea is to keep the rules broad and simple and let the user perform more intricate calculations to determine if its suits their expectations.

PS: I'm traveling this weekend, will be back in action next Thursday.

[BennyThadikaran]

Version 7.2.2 has implemented AB=CD pattern.

The C point must retrace between 0.382 and 0.886 Fib levels. After rounding the retracement to the nearest FIB level, we calculate the FIB extension where point D should end.

The length of AB is also extended from C to give us the completion point for D.

The completion point and FIB extension together forms the zone of resistance for possible reversal. I added a 1.5 % threshold below this zone. A Close below this threshold will nullify the pattern.

To limit the number of patterns,

• The last Closing price must be the lowest point after B.
• If the reversal zone is greater than 10% it is skipped.

Expect some changes to be made. I will add more patterns in the coming weeks. Please do try it out and leave me your feedback here.