Educational : ABCD pattern , Entry, SL, Targets

ABCD is the basic market formation

If you are not familiar with this pattern, I would suggest to start market study with it.

it is the step, we use to build ladders, it is the brick we use to build walls.

AB=CD is the perfect ABCD

Price swings from A to B

C : Retracement from AB , could be 23.6 38.2 50 61.2 78.6 or even 1 of AB

Once retracement is completed ? How do I know it is completed ? watch price action, so strong rejection, don't assume it is completed till it is actually completed, the chart says that. Better late than sorry, don't be aggressive to assume competition before it is over. most people mistake this.

Project point D :
Measure AB and take the length copy / paste line to start from point C

Targets : Use fibo levels on the length CD , highlight 61.8 78.6 1 1.27 and 161.8 levels.
Most likely u get one of these levels .

Try to do this on the direction of trend, basically if we study US30 Dow jones, annual trend, do ABCD only on long trades, avoid short. ( to break this rule, you must have higher experience )

Once Price reaches 61.8 on CD scale, move stop loss to entry, risk free trade, close half lot size and let the other half run : runner, its called.

If you are familiar with patterns or Elliott wave theory or Market outlook and analysis, you will know when to close at 100% and when to let it run to 161.8 or further. However, for a beginner , I recommend to close the other half at 100%

Once the ABCD pattern completed, you need to study the market again, to spot a new Structure and how to trade it

Stop loss: Below point C in a buy trade, and above it in a sell trade.

Advanced hint : The previous ABCD formation all together could be A or B or C or D in a bigger degree ABCD formation. or structure.

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What to expect after ABCD ?
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