For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. It can be used in any financial market and on any time frame. For this reason it is sometimes called the lightning bolt pattern. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading. The pattern consists of three legs, with two equal legs labelled AB and CD, together they form a zig-zag shape. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight.
ABCD PATTERN HOW TO
No representation is being made that any account will or is likely to achieve profits or losses similar to those shown in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. Trading the ABCD pattern involves rules meant to guide people on how to enter trade, lock potential profits and exit with minimum loss if the market follows the. The maximum retracement of the AB leg is an 88.6 level that defines a less extreme ABCD pattern formation but still valid. In an ideal ABCD Pattern, the C point must retrace to either a 38.2 at a minimum to validate the structure. Hypothetical performance results have many inherent limitations, some of which are described below. The Fibonacci numbers in the pattern must occur at specific points. Past performance is not indicative of future results. It looks like a diagonal lightning bolt and can indicate. These distinctive formations form the basis of what we call technical analysis. As you can see from the charts above, point A should be the 61. The ABCD pattern is a visual, geometric chart pattern comprised of three consecutive price swings. A pattern is simply a recognizable configuration of price movement. As usual, you’ll need your hawk eyes, the Fibonacci tool, and a smidge of patience on this one.
ABCD PATTERN PROFESSIONAL
We recommend that you seek advice from a qualified professional adviser before acting on any information or other content appearing on this website or any website to which may be linked. In fact, this three-drive pattern is the ancestor of the Elliott Wave pattern.
The content is not intended to provide investment, financial, accounting, legal, tax or other professional advice and should not be relied upon or regarded as a substitute for such advice.
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