Harmonic Patterns in Trading

Harmonic patterns take on a variety of different shapes in analysis, producing varying ripples between the letters "M" and "W." The basic patterns of harmonic patterns consist of five points (X, A, B, C, D). Harmonic patterns can seem a bit strange at first and difficult to recognize when reading a stock chart. However, once traders become accustomed to them and learn how to apply Fibonacci numbers to the waves, they become easier. Below, we review the most important and common harmonic patterns. The Gartley Pattern According to many sources, the Gartley Pattern represents the first nucleus of harmonic patterns in general. It derives its name from its discoverer, the writer H.M. Gartley, who included it in his book "Profits in the Stock Market." He then applied Fibonacci numbers to the pattern and re-introduced it in his book "The Harmonic Trade."