Gartley/Butterfly patterns

[dumbass]

i do believe your light years ahead of carney , i know from your previous posts you would not blindly trade these patterns .

it seems in volume 2 he has related the price action to rsi , which will provide added protection for trading alternate bats and butterflys as the price will print lower from x point but rsi should diverge.

not much use in crabs (price action too far away from x point) and gartleys no price low

[arco]

I wonder how much trading Scott actually does with the patterns.

I havent read all the book yet, but so far havent seen any entry/exit ideas. As well as the patterns I would also like to see actual examples of entries/exits. Readers really need to know how to properly trade these patterns, plus money management ideas.
Did book 1 give this info?

Anyway, interesting to see the move ended spot on the 261.8

PS - have you read page 264?

[roddy]

Hi DB /ARCO
initially to know what type of pattern is forming does it depend upon the B projection whether its .50 or over?
supposedly here is a bat in the making b 38.2 and currently price is 7272 so would Carney as soon as 7275 has been taken out, go long? with d extending to .7950 area being price reversal zone 886 of x a leg.am i on the right track?

[dumbass]

morning roddy

from what carney says all patterns are unique and quite specific

in the retracement patterns the gartley has a very non negotiable 61.8 so that pattern forming could be a bat possibly overshooting 886 as its not an ideal 50

he refers to this thing called a bamm which means a bat printing that passes a b point on cd leg is atrigger to buy with target around 886 but like anything needs confirmation

[dumbass]

morning roddy

from what carney says all patterns are unique and quite specific

in the retracement patterns the gartley has a very non negotiable 61.8 so that pattern forming could be a bat possibly overshooting 886 as its not an ideal 50

he refers to this thing called a bamm which means a bat printing that passes a b point on cd leg is atrigger to buy with target around 886 but like anything needs confirmation

[arco]

Hi Roddy

I tend to think of patterns as being either a Gartley shape or a BF shape (or derivative). I personally dont worry now about any other names. Its basic Fibonacci after all is said and done.

Generally Gartleys B is 38.2-618 and BFs may go to 618-786. Occasionally potential Gartleys go on to become BFs and what you thought was going to be a BF ends as a Gartley.

Hobbs gives the Gartley B leg a 38.2-61.8 measure, Pesavento states a Gartley should have a B leg btw 618-786 75% of the time, and an AB=100%CD. Carney staes B must be exactly 618. So you will see, everyone has there own idea. Mr Gartley didnt even give a fib measure to the pattern, and he discovered the shape in 1935. Carney came up with a 5-0 pattern recently - I've always called it a drop leg butterfly. And so it goes on.

Have a look at Carneys site, bascially you get all the pattern measures there for free, and you can download PDFs on BAMM and 5-0.

http://www.harmonictrader.com/

rgds - arco

[roddy]

DB/ARCO,
its starting to make more sense,do you trade the d leg,or wait
for price reversal zone

[arco]

Roddy

Its a method that can be exploited, but I dont often do it that way
unless I have other signals to confirm.

Trading the D leg - you could basicially look to trade the B breakout,
unless you like aggressive trading off Fibs or Ganns on a potential C reversal.
(see Carneys free Bamm PDF for some ideas of D leg trading).


Gartley Watch
Check out Eur.Chf for a perfect Carney Gartley set-up with B = 618. We
can watch this one and see how it plays out.

"The Great Gartley Controversy"
http://www.harmonictrader.com/gcontroversy.htm

[arco]

Alan Farley has a different set of parameters for a Gartley. Quote...........

Apply less common retracement strategies to avoid the crowd. H.M. Gartley described little-known Fibonacci relationships in his 1937 book "Profits in the Stock Market." The Gartley Pattern relies on a 78% retracement, and represents another way to capitalize on those caught in a 62% whipsaw. This classic setup, first described almost 70 years ago, works just as well now as it did during the Great Depression.

[dumbass]

afternoon guys , yeah interesting concept trading in the patterns , i do feel its something im going to have a bit more of a crack at, probably trying to identify bats.

i like carneys approach to rigid pattern parameters , it just seems to make it easier to apply.

interesting that pattern you posted arco from alan farley , i would say that could well be a bat in progress , 50 retracement , rough trend line through a - c point bounce in progress looking 886 completion.not impossible which i guess just goes to show how its a dynamic situation,
but certainly a profitable trade off that 786 what ever you call it