It's been a rough go around for pattern trades as of late (I'll talk more about that in my Weekend Review tonight youtube.com/channel/UCVveEks3MWZqOsvzTF_LGQg) But if the pattern is valid and meets you ROE's then you've got to pull the trigger.
I'm still holding the 2nd half of my position on a EURUSD short from earlier in the week, but today we've got both a bullish gartley and a bearish bat bracketing this pair.
For news today we want to keep an eye on 8:30am (ny) as our usual Unemployment Claims are released and then once again at 3:00pm (ny) as the ECB President Mario Draghi is set to speak.
2 weeks ago I had 15 trades and 10 were winners...
Akil_Stokes
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Nice! Yeah that's what I've noticed with advanced patterns. Very streaky. During market consolidation we get a bunch of winners at once. When the market is trending we get a lot of failures. Exactly why we need to make sure we take what we're supposed to take and just survive the drawdowns. The problem is many traders get to the drawdown, quit trading then miss the next hot streak
Jurij
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In trending condition many retracement patterns (gartley/bat) fail, whereas extensions pattern like the butterfly and crab still do fine. Maybe in such conditions it is better to trade the retrace patterns only with the dominant trend.
The other thing is, since the completion of forming Bat pattern is very likely, one could use the BAMM theory (from Scott Carney) to model setups. For example if I see a Bat forming, on B break I enter with SL placed at C and TP at .886 XA.
Hope it gets better next weeks, good trading :)
WendelinProbst
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Yes Akil I made the same experience, since the start of last week I traded 41 patterns of which 24 were stopped out. Frustrating but you have to go through that as well and it seperates the ones that stick to the strategy from the ones that get emotional then...
best regards, Wendelin
Boutestijn
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The B retracement of your bull garley gartley pattern is 76.4
shouldn't it be 61.8 to be a valid gartley?
Akil_Stokes
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Hey Boutestljn, the 61.8 is just the minimum requirement. Unless you're looking for the perfect "222" gartley completion, it can go beyond it.
lancecarr
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B must retrace to at least the 61.8 (i.e. touch it) but can go past. If it touches the 78.6 then it is invalidated.
Davis
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As far as I understand these patterns then B must retrace to at least 61.8 but must not violate A
That means B can touch 78.6 and still can be a valid pattern.
Jurij
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but if it does touch the 78.6 level it could be also a potential butterfly pattern. In this cases watching the closing price of the candles can give clues.
Akil_Stokes
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You are correct Lancecarr, the B leg cannot touch the 78.6, if so then we will be looking for a potential butterfly pattern instead of a gartley