Trading Harmonics "The real deal"

xProphet

Active Trader
Jul 27, 2013
64
0
27
Occupying Wall Steet.
That is right, "Trading Harmonics " no longer a joke..(well, it may remain so with some of you.)

Anyways, I accidentally came across this website and it deals with "Trading Harmonics". At first glance it seems to be based off fibs so it has my attention if only for a moment. (I'll step outside the box.) I have a lot of other trading related "things" to go through first so, if you have time check it out and let me know what you think.

Please don't reply if you couldn't be bothered to at lest checkout the website.

Here's a page from the website:
"Trading Harmonics Psychology"

There is a kind of harmonics psychology of crowds underlying the harmonic patterns. Harmonic patterns are formed by the combined behaviour of hundreds of thousands of traders - crowd psychology - playing out fear & greed, supply & demand scenarios.

To illustrate, we'll take a "leg-by-leg" look at one of the harmonic patterns - the bullish Gartley.

pattern-gartley-pic500.gif

Bearish Gartley - and - Bullish Gartley

XA leg: The X point is the starting point, and represents a major low swing point. Its a point where sentiment changed radically. This can be found on higher timeframe charts at a major low, and is a key reversal point traders pay particular attention to.

As the XA leg develops it breaks through previous resistance levels - effectively taking them out.

AB leg: This is the first wave in the pattern. The A Point is the top of the trend, and a key sign would be reversal candlestick patterns forming here - such as tweezers, doji's, engulfing candles, harami patterns and so on. Uncertainty of price at this level then takes hold, and price drops back to point B as profit taking gathers momentum.

On the Gartley, the B Point is a 0.618 retracement of the XA leg - 0.618 being a very significant Fibonacci retracement level known to almost all traders.

BC leg: Investors start to buy in at the B level. (the 0.618 retracement of the XA). Other traders gain confidence by the rising price, and also buy in, pushing price up to C.

The C point is a retest of previous highs - typically at a 0.382 - 0.886 Fib retracement of the XA leg.

CD leg: As price fails to break-out of resistance, profit-taking takes price down to D - usually between a 1.27 and 1.618 Fibonacci extension of the BC leg - forming a pattern where the AB leg is equivalent to the CD leg. The AB=CD pattern.

D Point: The D point inside the PRZ, the Potential Reversal Zone, is the trade entry level."


It was discovered that, when a particular sequence of Fibonacci ratios appear in order in a X-A-B-C-D pattern, as in the Gartley pattern above, the probability of forecasting the next move successfully is over 70%.

When that happens, you have an edge, and it's time to trade.

That's why harmonics traders wait patiently until price gets to the D point, and the pattern completes before taking the trade.

I added nothing, "everything in the quote" was taken directly from the website.
 

Emibluz

Banned
Aug 22, 2013
165
0
27
Harmonic patterns are read from the common trend from general combined traders mental reactions in the market. Basically, they assist traders notice possible retracements of recent trends. As earlier mentioned the leg by leg Gartley harmonics approach is commendable. If well combined with the fibonacci numbers using geometric price pattern to spot precise turning points. it could boom. They are noticeably good in predicting future movements.
 

eyeball

Master Trader
Sep 25, 2011
164
11
49
I would try and learn this system but I lost my harmonica several years ago (at the beach) and cannot afford a new one--EB
 

reaneyts

Trader
Nov 28, 2013
13
0
12
forexreviewjournal.com
What is realistic is discovering the order within the chaos in the financial markets, defining that order and being willing to take some risk in return for financial reward.