Butterfly Harmonic Model This is one of the powerful Harmonic models that give an accurate analysis if the conditions of this analysis are met. This model has two types of buying and selling models.
Characteristics of the butterfly model purchasing case:
The butterfly pattern consists of six main sides as shown in the diagram
A-X, A-B, X-B, B-C, B-D, C-D.
- The formation of the pattern begins with the first leg, which represents the upward movement and is strong and is called this leg X-A.
- The A-B leg is composed of 78% Fibonacci retracement of the first X-A leg.
- The B-C leg is formed with a 38% – 88% Fibonacci retracement of the A-B leg correction.
- The last leg is formed by C-D and it is extended from the B-C leg and is between 161% – 261% of Fibonacci.
- The last point D, at which the pattern ends, is calculated in Fibonacci between 127% -161% and extending from the X-A leg.
Characteristics of the sell case of the harmonic butterfly pattern:
- movement and is strong and this is called the X-A leg.
- The A-B leg is composed of 78% Fibonacci retracement of the first X-A leg.
- The B-C leg is formed with a 38% – 88% Fibonacci retracement of the A-B leg correction.
- The last leg is formed by C-D and it is extended from the B-C leg and is between 161% – 261% of Fibonacci.
- The last point D, at which the pattern ends, is calculated in Fibonacci between 127% -161% and extending from the X-A leg.
Notes:
- The measurements mentioned are the most important and accurate measurements of the model.
- If the measurements are close to the basic measurements, the pattern is 50-70% complete and you can count on it but not accurately.
- Goals In the case of buying or selling in this form, the targets are 25% -50% -75% -100%.
Tips to follow when the form is complete:
Find Price Action to enter by using an analysis school – looking for support or resistance or supply or demand area.
or use a Japanese candles that determine the change of direction, and the use of wave analysis Elliott.
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