trading a harmonic bat pattern with confirmation

5 mars 2019

hey traders,

on dollar cad we have one more perfect example of how to trade harmonic patterns with confirmation.

first of all, dollar cad pair in a side move for a while, and we see that the market is approaching
a significant level of resistance looking left.

we have a completed bearish bat pattern with the selling zone that perfectly matches with a structure.
+RSI is overbought.

on a lower timeframe we see a local rising parallel channel.
bearish breakout of this channel will be a good confirmation.
so you can sell the market as the channel is violated and the market closes below support line of a channel.


last but not least,
there is also a potential head and shoulders pattern,
you can wait and sell bearish violation of a neckline


targets are 382 and 618 of AD

good luck!

5 mars 2019

Note

Market is still following a local rising channel

6 mars 2019

Ordre annulé

6 mars 2019

Note

What have we learned from this trade?
Though the order was canceled,
We see the difference between aggressively trading a harmonic bat pattern, setting a sell limit order around 886 fib of XA, and trading with confirmation.

If we aggressively traded this pattern, we would lose, however, we have avoided a loosing trade because we haven’t got a confirmation.