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Thread: XABCD Diagonal pattern definition

  1. #21
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    Hello Mike,

    You're right about EW, and in EW theory, that is an ending diagonal (wedge) and looks like WW.
    Anyway thank you so much.. you're very kind person and very helpful.. Be blessed..

    Regards,

    Clara

  2. #22
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    Hi All,
    Why do WW patterns fail...? I recently stumbled across some educational videos by Georgtrio at http://www.stochastic-macd.com/convergentsignals.htm that may help to see things more clearly. The videos deal with convergent signals, which is an area where bulls take profit and bears enter the trade, making for a very powerful confluence of opinion and strong moves.
    In the chart below, you will see a WW formation that fails to reach the 1-4 line, as there is strong support to the left. Also, the 1-3-5 line diverges from the 2-4 line; does this divergence indicate a WW failure? I have read that the WW lines should converge; maybe this factor makes the difference between pattern success and failure.
    XABCD Diagonal pattern definition-failed-ww.jpg

    In his videos he also talks about the AB=CD pattern and the fractal nature of price across time frames.



    Regards,


    Mike

  3. #23
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    HI All,
    Two charts here with WW patterns that did hit the 1-4 line. Notice how the lines 2-4 & 1-3-5 steeply converged, and that point 5 only just poked through the 1-3 line. Maybe this is the answer to a more successful WW pattern; that a wedge exists and the wedge is steep, and point 5 only just pokes past the 1-3 line? Or, is success also better when point 5 doesn't quite get as far as the 1-3 line?

    XABCD Diagonal pattern definition-usdjpy-h1.jpg

    XABCD Diagonal pattern definition-usdjpy-h1-2.jpg

    Regards,


    Mike
    Last edited by blott; 03-02-2014 at 06:55 PM.

  4. #24
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    @blott: maybe also try to find some confirmation rules with the volume
    Harmonics Tube - daily trading setups based on harmonic patterns
    Forex Harmonic Trading - Harmonic trading practical tips, tricks and hints
    AMPmonitor - harmonic and price patterns recognition Scanner that I use
    TradingArsenal Quiz project - best edu material regarding the Harmonic Patterns Trading

  5. #25
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    Quote Originally Posted by kor4x View Post
    @blott: maybe also try to find some confirmation rules with the volume
    HI Kor,
    Thanks for the suggestion, but I've not yet been able to definitely any correlation between volume and success of a WW. Sometimes volume is high and sometimes it's low at a turning point.

    Regards,


    Mike

  6. #26
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    @blott: so maybe it's not the turning point that is important, and you could check how the volume behaves during the move (before the turning point).
    Harmonics Tube - daily trading setups based on harmonic patterns
    Forex Harmonic Trading - Harmonic trading practical tips, tricks and hints
    AMPmonitor - harmonic and price patterns recognition Scanner that I use
    TradingArsenal Quiz project - best edu material regarding the Harmonic Patterns Trading

  7. #27
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    HI Kor,
    This WW evolved this morning, though I drew the fib too late.
    Seems like fibs are the best way to go; bounced exactly off the 61.8% of yesterday's swing. Also, high volume on last red bar, but it went nowhere; another clue.

    XABCD Diagonal pattern definition-gbpusd-7th-mar-fib.jpg

    Regards,


    Mike

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