Pattern fits perfectly into Elliott Wave Theory. XA swing would be labeled as wave1 and ABCD would be labeled as ABC Elliott correction. Both harmonic and Elliott traders try to catch the strongest wave 3 or at minimum wave C.
For more info about the Gartley pattern and the confirmation methods see -> Gartley pattern - table of content
Last edited by kor4x; 09-02-2012 at 08:26 PM.
Gartley pattern internal structure
when we talk about Gartley (in context of the Elliott Wave Theory) we talk about simple ZigZag correction.
A zigzag a simple three-wave pattern labeled A,B,C and subdividing into 5-3-5 sub-waves.
The following diagram presents single/simple and double ZigZag corrections (Elliott Wave Theory):
Last edited by kor4x; 08-07-2012 at 10:08 PM.
Based on this theory we should look for the following internal Gartley pattern structures (4 cases identified):
Case1
Case2
Case3
Case4
Note: more on Elliott Wave theory and especially on Correction types can be found on Elliott Wave International: Expert Market Forecasting using the Elliott Wave Principle
Last edited by kor4x; 08-07-2012 at 10:10 PM.
Originally Posted by kor4x
Based on this theory we should look for the following internal Gartley pattern structures (4 cases identified):
Case1
Case2
Case3
Case4
Note: more on Elliott Wave theory and especially on Correction types can be found on Elliott Wave International: Expert Market Forecasting using the Elliott Wave Principle
I seem to have a pretty good entry technique but really need to focus on the location of the patterns.
Would you say that using the Elliott wave theory is the best way to spot the location of a harmonic pattern?
If not what would you suggest is the best way?
harmonic patterns are easier to spot and are more rule based than the Ellie wave. I love the Ellie wave for the abc pattern in first wave, however remember there should be 5 fractals in the same first wave before the retracement.
Would this be good real life example?
I came across it this morning.
first wave in a new trend does not always look like 12345 EW fractal, actually I think more often it looks like another ABC correction, as most traders expect the previous trend to continue.
So if I am getting this.. We are looking for a gartley just after the last high / low swing on a higher time frame?
first correction (W2) in a potential new trend. So you need to have a reason to think that previous trend is over.
Got it. So we are looking for what looks like a pull back from a high / low swing but other signals confirm that it likely that higher highs or lower lows will not be made and the trend has changed.
Sorry if I am a little slow at getting this but I'm pretty sure that chart positioning is one of my major problems.
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