The Bat pattern is a variation of the harmonic pattern Gartley. The outlines of these patterns are the same, the difference is in Fibonacci ratios that define the positions of the main points.
Let’s have a look at the parameters of a Bat pattern:
- Point B is at the 38.2-50% retracement of XA.
- Point C can be at the 38.2%-88.6% retracement of AB.
- Point D can be found at the 161.8%-261.8% extension of AB or at the 88.6% retracement of XA.
How to trade
The entry is at the point D. As usual, a confirmation of the market’s reversal here is necessary. Take Profit may be at 61.8% of CD (TP1), 127.2% of CD (TP2), and/or the projection of XA from D (TP3). Put a Stop Loss in line with your rules of risk management.
Let's have a look at the example of the bullish Bat pattern on the chart.
You can see that the point B is at about the 61.8% retracement of XA, the point C is at the 88.6% retracement of AB, while the point D is near the 88.6% retracement of XA. The Fibo ratios are not exactly the same as at the scheme, but they are close enough. Notice that a "harami" candlestick pattern was formed at the point D confirming the price's reversal to the upside.
এই সেকশনের অন্যান্য আর্টিকেল
- What does ‘truncation’ mean?
- Leading diagonal pattern
- Wolfe waves pattern
- Three drives pattern
- Harmonic patterns
- Motive and corrective waves. Wave degrees
- Intoduction to Elliott Wave analysis
- How to trade breakouts
- ফরেক্স ট্রেডিং নিউজ
- How to place a Take Profit order?
- Risk management
- How to place a Stop Loss order?
- টেকনিক্যাল ইনডিকেটরঃ ডাইভারজেন্স ট্রেডিং