Hey mates. This is a harmonic
setup. My rules say to wait until price goes to the reversal zone and hits at leas two of the levels marked on the chart. If this criteria is met I wait until price goes back and closes at least above one of those levels that were hit.For example, price hit 1.618ab and 0.886xa and then went higher and close above 0.886xa. If this criteria is met I enter long at market. Stoploss is placed at X and the targert is 0.382AD. If price goes lower and hits 1.272 also then I will wait until it goes back and close above it and only then I enter. If price goes through the zone and closes beyond the last line of 1.272 then the pattern is invalidated because the reversal zone is violated. These rules are more conservative as compared to the rules of trading with limit orders that are used in advanced
formations. There is also a bit more conservative way to look at the divergence of rsi
when all above criteria are ment. In this case the pattern becomes even more accurate. So guys, you should not mix advanced
formations and harmonic patterns
because they are traded different ways.