A detailed explanation of the BUTTERFLY harmonic pattern 🦋
🔹 BUTTERFLY is a reversal pattern consisting of four waves, similar to the Gartley and Bat pattern.
They are X-A, A-B, B-C and C-D waves.
🔹 Helps you identify when the current price movement is coming to an end, this means that you can enter the market as the price reverses its direction.
🔹 There is a bullish pattern where you can open a buy position
And a bearish pattern where you open a short position.
🔹 BUTTERFLY is a reversal pattern that allows you to enter the market selling at the highest levels and buying from the extreme bottoms.
🔴 buying style:
1️⃣ We have a strong upward movement, which is the beginning of the pattern and is called the (X-A) leg.
2️⃣ The leg (A-B) must be 78% Fibonacci retracement of the leg (X-A)
3️⃣ Then the leg (B-C) and it should be between 38% and 88% Fibonacci retracement of the leg (A-B)
4️⃣ Then the leg (C-D) and it must be between 161% and 261% Fibonacci extension of the leg (B-C)
5️⃣ And the pattern (D) ends, which should be between 127% and 161% Fibonacci extension of the leg (X-A)
6️⃣ When the model is formed and its conditions are completed as we mentioned, the price will rise from point (D) and can benefit from buying from point (D).
🔴Selling style:
1️⃣ We have a strong downward movement, which is the beginning of the pattern and is called the (X-A) leg.
2️⃣ The leg (A-B) should be 78% Fibonacci retracement of the leg (X-A).
3️⃣ Then the leg (B-C) and it should be between 38% and 88% Fibonacci retracement of the leg (A-B).
4️⃣ Then the leg (C-D) and it must be between 161% and 261% Fibonacci extension of the leg (B-C).
5️⃣ And the pattern (D) ends, which should be between 127% and 161%, the Fibonacci extension of the leg (X-A).
6️⃣ When the model is formed and its conditions are completed, as we mentioned, the price will drop from point (D) and the sale can benefit from point (D).
below you can see other educational content
🔹 BUTTERFLY is a reversal pattern consisting of four waves, similar to the Gartley and Bat pattern.
They are X-A, A-B, B-C and C-D waves.
🔹 Helps you identify when the current price movement is coming to an end, this means that you can enter the market as the price reverses its direction.
🔹 There is a bullish pattern where you can open a buy position
And a bearish pattern where you open a short position.
🔹 BUTTERFLY is a reversal pattern that allows you to enter the market selling at the highest levels and buying from the extreme bottoms.
🔴 buying style:
1️⃣ We have a strong upward movement, which is the beginning of the pattern and is called the (X-A) leg.
2️⃣ The leg (A-B) must be 78% Fibonacci retracement of the leg (X-A)
3️⃣ Then the leg (B-C) and it should be between 38% and 88% Fibonacci retracement of the leg (A-B)
4️⃣ Then the leg (C-D) and it must be between 161% and 261% Fibonacci extension of the leg (B-C)
5️⃣ And the pattern (D) ends, which should be between 127% and 161% Fibonacci extension of the leg (X-A)
6️⃣ When the model is formed and its conditions are completed as we mentioned, the price will rise from point (D) and can benefit from buying from point (D).
🔴Selling style:
1️⃣ We have a strong downward movement, which is the beginning of the pattern and is called the (X-A) leg.
2️⃣ The leg (A-B) should be 78% Fibonacci retracement of the leg (X-A).
3️⃣ Then the leg (B-C) and it should be between 38% and 88% Fibonacci retracement of the leg (A-B).
4️⃣ Then the leg (C-D) and it must be between 161% and 261% Fibonacci extension of the leg (B-C).
5️⃣ And the pattern (D) ends, which should be between 127% and 161%, the Fibonacci extension of the leg (X-A).
6️⃣ When the model is formed and its conditions are completed, as we mentioned, the price will drop from point (D) and the sale can benefit from point (D).
below you can see other educational content
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