We just broke the up so we could be seeing some consolidation and a re-test now before we possibly head lower to possibly complete the bat.
My strategy will be to sell the breakout of consolidation, if it occurs, with 2 short targets:
- TP1: The possible bat's B point
- TP2: The possible completion of the bat at 0.886 of XA
No use in putting the trade in the chart since there is no way of knowing where a possible breakout of consolidation will occur. Looking at smaller timeframes now to try and pinpoint a nice entry for this possible short breakout trade!
The bat long setup is already on the chart, for reference only since we're no way close to completion yet.
As described in Harmonic Trading: Volume One by Scott Carney >>
Ideal Butterfly pattern elements:
• Precise 78.6% B point retracement of XA leg.
• BC projection must be at least a 1.618.
• Equivalent AB=CD pattern is minimum requirement, but the Alternate 1.27 AB=CD
is the most common.
• 1.27 XA projection most critical number in the Potential Reversal Zone (PRZ).
• No 1.618 XA projection.
• C point within range of 0.382–0.886 retracement.