Alexander_Nikitin
Long

Potential bat advanced formation

FX:AUDUSD   Australian Dollar/U.S. Dollar
Bat Advanced formation rules of engagement.
Tools:
*Fibonacci retracements (38.2%, 50%, 61.8% and 88.6%)
Timeframes:
*The Bat Advanced formation was originally designed as a swing trading strategy. But it also works on lower timeframes.
Tactics:
*Seek to identify 4 market moves and 3 major Fibonacci zones. The combination of these moves forms the points (X, A, B, C, D) that fulfill the formation.
Rules of engagement: Criteria 1
The Bat Advanced formation starts with a market movement/impulse leg that establishes our X and A points.
Once X and A points have been identified, we then look for our first criteria.
Criteria 1: The market forms the B completion point by fulfilling at least a 50% retracement of the XA leg.
Note: AB move remains valid as long as there is at least a 50% retracement of XA and that it does not touch the 61.8% retracement of XA. Only candlewick is calculated here. Candle close is not important.
Rules of engagement: Criteria 2
If criteria 1 has been met, then look for criteria 2.
Criteria 2: The market forms the C completion point by fulfilling at least a 38.2% retracement of the AB.
Note: BC             move remains valid as long as there is at least a 38.2% retracement of AB and that it does not extend past A. Only candlewick is calculated here. Candle close is not important.
Rules of engagement: Criteria 3
If criteria 1 and 2 have been met, then look for criteria 3.
Criteria 3: The market forms the D completion (entry point) by fulfilling a 88.6% XA.
Note: D point never extends past X.
Trade management: Entry, stops & targets.
Entry: Limit order is placed at D completion point.
Target 1: 38.2% retracement of AD leg. When attained half of the position closes & stop moves to breakeven.
Target 2: 61.8% retracements of AD leg.
Stop placement: Stop always goes past X. Either 113% XA extension or 1 ATR beyond X, or 78.6% of the 1st target distance above/below the entry.
Trade active: limit order was triggered
Trade closed: stop reached
D1 look promising for bears ..
Reply
hi Alexander,
how do you calculate ATR, which is what you are using for stops?
thank you for all your posts
kindest
Reply
@OHBROTHER, I don't use atr for stops. I use 78.6% of the first target distance.
Reply
thank you
Reply
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