How To Use Harmonic Pattern To Generate Solid Forex Signals

Today I want to explain how to use an harmonic pattern called `Gartley` in forex trading for sustainable profitability.
Gartley is an effective forex trading tool and it is compatible with any timeframe and currency pairs.It is a pattern which relies on the philosophy that to every trend, there is a retracement. Most of the times, it is formed near tops or bottoms. Since Gartley is a retracement trading pattern, it typically makes the most of Fibonacci tools.There are two types of gartley; bearish gartley and bullish gartley.

Bearish Gartley
It is a pattern in which fibonacci tools is used to determine the possible end of a retracement in a downtrend and to  indicate the salient selling point during the rally.

The folowing rules apply when using observing bearish gartley formation:(1) The length AB must be atleast 61.8% of length XA. (2) BC can retrace 38.2% and 88.6% of AB. (3) CD can project between 1.272% or 161.8% of AB. (4) CD can also be a retracement of up to 78.6% of XA. (5) The point D is regarded as the potential reversal zone which is the entry point for sellers. (6) Stops are placed slightly above point X. (7) Profit objectives are placed around point A.

 The diagram above further illustrates Bearish Gartley pattern.

Bullish Gartley
It is a pattern in which fibonacci tools is used to determine the possible end of a retracement in an uptrend and to  indicate the salient point to buy during a bearish trend.

The folowing rules apply when using observing bullish gartley formation:(1) The length AB must be atleast between 38.2%61.8% of length XA. (2) BC can retrace 38.2% and 88.6% of AB. (3) CD can project between 1.272% or 161.8% of AB. (4) CD can also be a retracement of up to 78.6% of XA. (5) The point D is regarded as the potential reversal zone which is the entry point for buyers. (6) Stops are placed slightly below point X. (7) Profit objectives are placed around point A.

The diagram above further explains bullish and bearish gartley patterns.

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