Learn chart pattern trading

Chart pattern trading is the main method for a lot of traders to make money in Forex, patterns mean that a familiar shape of points, when you recognize one of these patterns then you’re so close from a successful trade.

Charts pattern trading is could be a very profitable strategy for you only if you understand how it move and when you make a good plan, the good point about chart pattern trading is that the profit you get will cover the loses you had easily.

It's important to learn how chart patterns form and move, here we’ll teach you the necessary help to get closer to charts pattern world and use the necessary tools to make your winner trades.

Chart patter is a serial of high and low points, there is a relation between these high and low points, they are not random at all. It discovered by scientists, they made a lot of studies to find these relations and to find the accurate number to recognize the pattern easily.

A scientist found out that market moves in waves, a strong long wave followed by a short wave in the opposite direction, these wave called Elliot wave, another one found out that market found resistance and support in specific levels, he measured the levels and found out the Fibonacci numbers.

So we use this logic to know when the market will move and where, there is no traders on earth need more then the answer to these to questions: when and where.

In the next posts we’ll talk more about patterns like Gartley pattern, butterfly pattern, bat pattern and crab pattern, we’re following specific rules with a specific resistance and support levels which will help you to understand how things work and to make your own way for trading.

Read Fibonacci Retracements Levels

This article for Fibonacci beginners, we’ll learn in this article how to read and understand Fibonacci numbers for charts pattern.

Charts pattern are recognized by resistance and support levels are formed, we measure these levels and compare it with charts pattern levels we know, then we start to make the trade setup.
You may not can read the ratio numbers in your trade, for example if you read ratios like 0.618, 0.382, 1.618, what these numbers mean??

Charts pattern like Gartley pattern, bat pattern, butteryfly pattern and crab pattern consists of 4 waves, 0.618 is the first retracement wave, you can measure this level by Fibonacci tool in your chart window, and this is the first resistance level.

To know how we get the value 0.382, your start point is A and B will your end. Then measure the level we have, and this is the first support level.

The last number is 1.618. and this is suppose to be the last wave and resistance level, to measure this level you need to move the start point to B and the end to C. By identify this level you have a good chance to make your setup for a successful trade. Good luck.

Chart Pattern Entry Point

Entry point is very important in your trades, entry point, exist point and target level are member in your successful Forex strategy, and all suppose to work together in harmony to bring you the required profit you want.

Forex chart pattern entry point it’s vary from strategy to other, here we’ll try to review the different kind of entry point hope it’ll help you to find the one you like.

First entry point is take after making the necessary confirmation about the trend direction, you made the necessary analysis and your indicators telling you that there is a Gartely, Bat, butterfly or crab pattern. It could be not enough for some trades, so he keep his eyes on the chart waiting for more conformation which in most cases is passing the specific Fibonacci level like in the picture below.





As long as we’re using Fibonacci levels to recognize the pattern then why don’t we simply make the entry point just when the price touch the Fibonacci level and before reversing, of course it’s not easy at all, even if you’re going to use the most advanced pattern tools.

For example if you have a Gartely pattern and you’re waiting the price to reverse at 78.8 Fibonacci level, then you can make your entry point exactly at this price. This way is risky and very aggressive and rarely to happened, because if you missed the calculation by only one pip, then you’re out, but we can trade with another way close to this one.

Some Pattern tool are generating Fibonacci levels based on your pattern prices, these tools recognize your pattern and tell you the Fiboancci level like
Gartely 0.618 0.786 1.27
Butterfly pattern 0.618 0.786 1.618
Crab Pattern 0.5 0.707 3.618
Bat Pattern 0.5 0.707 2.24
Using these level we’ll give us a reversal range, by making an entry point in the beginning of the range with a stop loss at the end of the range, then we have a potential area for reversal, and it’ll reverse in most cases if we make the right analysis.

Fibonacci Expansion and 1-2-3 Pattern

Fibonacci Expansion is a very important tool in forex trading; a lot of Forex strategies are designed based on Fibonacci Expansion tool, check 1-2-3 pattern strategy, which called also ABCD formation.

There are few Forex platforms don't include this tool, but this exist in most platforms including the widely used platform MT4.

If you're familiar with Fibonacci Retracement then you know that you need to points to draw Fibonacci Retracements, but in Fibonacci Expansion you need three points, A, B and C.

If you're in a bearish trend, then the first point will be the heist high, second point is the lowest low and the third point is a lower high, which is the top of bull back wave.

If you're in a bullish trend then the first point will be the lowest low, second point is the heist high, and the third point is the higher low, which is the low of bull back wave.

Just click the tool then click the Point A in the chart and drag to point B, then double click the tool to get the ability to control Point C and drag it to the write point.

Buy using this tool, you'll get the potential targets for your trade, you can edit the build in Fibonacci number in the tool by right click the tool, then choose the first option "Expansion Properties" then choose the Fibo levels tab, then add the values you want to add to Fibonacci numbers.

Elliot wave and more than 60 MT4 indicators

Mt4 is considered No.1 choice for a lot of brokers, therefore is considered the most important platform in Forex world. A lot of traders pay more attention to any updates, enhancements or inidcators for MT4.

Here you'll find a link to more than 60 MT4 indicators, the list below includes the available indicators, unzip the downloaded file and put the files in your drive as following
DRIVE

•Pivot_AllLevels.mq4
•Carter MA.mq4
•TradingHours.mq4
•ZigZagFirst.mq4
•ZeroLag MACD.mq4
•ZigZag_Fibo_v2beta.mq4
•ZeroLagStochsSignals.mq4
•TSI Signals.mq4
•WoodiesCCI.mq4
•Show_your_local_time.mq4
•Bollinger Squeez v3.mq4
•Bunnygirl Cross and Daily Open.mq4
•Triggerlines.mq4
•PivotPoints - MT04 - Indicator.mq4
•Vegas Currency Daily.mq4
•Fibo_Pivot_Lines_GMT.mq4
•TD Sequential.mq4
•TestWilliam36HistogramWalert.mq4
•better-murray-math-mm-levels.mq4
•X_profile.mq4
•Range.mq4
•Instantaneous Trend.mq4
•wlxFractals.mq4
•Vertical Lines.mq4
•DailyPivotPoints.mq4
•2EMA_systemv032.mq4
•newMACD.mq4
•TDI.mq4
•Var Mov Avg.mq4
•VSI.mq4

•Support and Resistance.mq4
•WcciPatterns.mq4
•TrendManager.mq4
•Pattern Recognition.mq4
•TradeChannel.mq4
•time to next bar.mq4
•TrendEMA.mq4
•Trend Bands.mq4
•TrendTriggerMod.mq4
•Elliott Wave Oscillator.mq4
•MACD Cross.mq4
•XO.mq4
•WeeklyPivotOnly.mq4
•CandleStop.mq4
•Ultitimate Oscillator.mq4
•Zerolagstochs.mq4
•Three_Color_MA.mq4
•Trend SMC.mq4
•Vegas.mq4
•TTF_hist.mq4
•SilverTrend_Signal With Alert v3.mq4
•Robot_PowerM5-m .mq4
•Paramon_Scalp.mq4
•FIBTunnel.mq4
•FiboPiv_v2.mq4
•ZigZag1.mq4
•Vegas S_P Daily.mq4
•TSI-Osc.mq4
•3colorMACD.mq4
•ZigZag_Fibo_v1beta.mq4


Download from HERE

Live trading with Online Fibonacci Calculator

A lot of traders consider Fibonacci levels is one of the most powerful trading methods, and they pay a lot of attention to Fibonacci numbers and use it for chart pattern trading.

Lately I start to use an online Fibonacci calculatore that gave me a very accurate numbers to recognize charts pattern, here I'll walk step by step for this trade.

First of all you search for a trend with two bull back waves like the one in the first image, like you see it's bullish trend followed by a bullback.

Our target here is to get point (D), getting this level will help too much in the trade, so we submit the wave value to the Fibonacci calculator, lowest point as X, then highest point as A, and the same way we submit (B) and (C), then click "Get Levels" button.

In this trade we got 5 levels, and the reversal point was in the third level, and I got the accurate number for the trade. Check the tool and make your testing with accurate Fibonacci calculator

Chart pattern recognition software

It's recommended to traders specially the beginners to keep a tool or software for chart pattern trading, this tool or software suppose to provide the necessary Fibo numbers for chart trading.

Besides charts recognition, there are online tools that give traders the necessary numbers and help traders to take the right decision about the trades. For example when you find a pattern is forming in your chart, and you're exiting to take it and open a position, in that case you can ask help for such tools to make sure that the price is following a stock pattern, it'll help you to take the decision.

Here you'll find a simple online free tool that will help you to identify which pattern you have in your charts, just fill the boxes with your prices value, and you'll get the pattern name plus the suggested line rejection which will help you to make your stoploose, entry point and targets levels.

By the time you man have the experience to recognize the pattern without any help, and you'll get profit with your own experience, but till then this kind of tool or software still important.