Thoughts about bat pattern. Some tips and secrets. Part X.
Welcome back, traders. It’s Wednesday and we have another edition of “Thoughts about Bat pattern”. Today we’ll continue discussing bat pattern types. Or… If we treat bats a vivid creatures I’d better say species)).
In my last edition I told you mostly how I discovered types but not about the types themselves. I got lots of feedback and messages asking me to explain the rules of distinguishing the types. So, I decided to start from the very beginning. For the sake of simplicity I will only explain one type per edition.
Let’s get it started then. But first, remember the critiria of distinguishing:
1. Is the pattern bullish or bearish?
2. Is XA straight or not straight? (“S” or “HS”)
3. Is BC straight or consolidating? (“N” or “F”)
4. Does A and C correlation form a double top/bottom or single top/botto? (“D” or “S”)
5. Is CD straight or not straight? (“I” or “P”)
Now I should explain what I mean saying “straight”. When I say “straight” I mean the move is not in terrupted by a specific size retracement. This size equals min BC requirement or 0,382AB.
I usually use square tool to establish the needed range. Then I just drag the square to the place I neeed to check. Or I clone it. Sometimes I just measure the amount of pips in 0,382AB and then measure the retracements within bat’s legs. Square tool is the most convinient). See picture 1.
If we have XA leg containing this size retracement then XA is marked “HS”. If we don’t have retracement of this size then XA is marked “S”. The same rule is for CD leg. If CD is interrupted by 0,382AB size retracement it is marked “I”. If not, then it’s marked “P”.
What is straight or not straight BC? It’s just a comparison with AB. Does BC look more consolidataing than AB or vice versa. Counting bar may help here. If AB has 2 bars while BC has 5 – we almost always have an “F” type BC. “F” type BC form cnannels, triangles, wedges while AB serves as a Flag staff. If AB is consolidation also – then we won’t have “F” type BC but “N” type. Remember, we are to compare the two legs. They either move with equal speed (sometimes BC moves faster) or BC moves slower. First scenario is for “N” type, second is for “F”. You are to train your eyes to see the proportions. Note that BC cannot be one-bar move (it invalidates the whole pattern).
I use Jason Stapleton’s rules for distinguishing double top/bottom when compare A and C placement.
Ok, suppose you have a bat pattern. To find out what type it is you are to answer the list of 5 questions I enumerated above.
Now you can distinguish type by yourself. Let’s discuss the types in details.
Last time I started discussing HSNSP and SNSP. I briefly described their features. Having lots of requests from my subscribers asking me to explain each type in more details I decided to explain these types once again. From now on I will explain one type per edition....
SEE continuation in comments... Tradingview doesn't allow too long descriptions))
In my last edition I told you mostly how I discovered types but not about the types themselves. I got lots of feedback and messages asking me to explain the rules of distinguishing the types. So, I decided to start from the very beginning. For the sake of simplicity I will only explain one type per edition.
Let’s get it started then. But first, remember the critiria of distinguishing:
1. Is the pattern bullish or bearish?
2. Is XA straight or not straight? (“S” or “HS”)
3. Is BC straight or consolidating? (“N” or “F”)
4. Does A and C correlation form a double top/bottom or single top/botto? (“D” or “S”)
5. Is CD straight or not straight? (“I” or “P”)
Now I should explain what I mean saying “straight”. When I say “straight” I mean the move is not in terrupted by a specific size retracement. This size equals min BC requirement or 0,382AB.
I usually use square tool to establish the needed range. Then I just drag the square to the place I neeed to check. Or I clone it. Sometimes I just measure the amount of pips in 0,382AB and then measure the retracements within bat’s legs. Square tool is the most convinient). See picture 1.
If we have XA leg containing this size retracement then XA is marked “HS”. If we don’t have retracement of this size then XA is marked “S”. The same rule is for CD leg. If CD is interrupted by 0,382AB size retracement it is marked “I”. If not, then it’s marked “P”.
What is straight or not straight BC? It’s just a comparison with AB. Does BC look more consolidataing than AB or vice versa. Counting bar may help here. If AB has 2 bars while BC has 5 – we almost always have an “F” type BC. “F” type BC form cnannels, triangles, wedges while AB serves as a Flag staff. If AB is consolidation also – then we won’t have “F” type BC but “N” type. Remember, we are to compare the two legs. They either move with equal speed (sometimes BC moves faster) or BC moves slower. First scenario is for “N” type, second is for “F”. You are to train your eyes to see the proportions. Note that BC cannot be one-bar move (it invalidates the whole pattern).
I use Jason Stapleton’s rules for distinguishing double top/bottom when compare A and C placement.
Ok, suppose you have a bat pattern. To find out what type it is you are to answer the list of 5 questions I enumerated above.
Now you can distinguish type by yourself. Let’s discuss the types in details.
Last time I started discussing HSNSP and SNSP. I briefly described their features. Having lots of requests from my subscribers asking me to explain each type in more details I decided to explain these types once again. From now on I will explain one type per edition....
SEE continuation in comments... Tradingview doesn't allow too long descriptions))
