7. Harmonic pattern types and principles

 

This pattern was proposed by H.M.Gartely in 1932 as a five-point pattern (Catley pattern). After that, a lot of traders and they improved the pattern. Chief among them is Scott Carney. He developed patterns such as BAT / CRAB / SHARK and added elements of money management and risk management.

 

The theory behind the harmonic pattern is the Fibonacci ratio correlation and price & time movement. It is used to check reversal points, retracements and extensions according to swing highs/lows. Based on this, we provide a standard for setting target price and stop loss price.

 

 

Below are examples of harmonic patterns.