Harmonic Trading with The Phoenix
This thread is dedicated to the identification and trading of Harmonic Price Patterns. Harmonic Analysis is a little-known field of technical analysis that utilizes Fibonacci Ratios and Price Pattern Recognition techniques. Pioneered in the 1930s by analysts such as H.M. Gartley, George Cole, and Wycoff and later practiced by such analysts as William Dunnigan in the 1950s, these techniques were popularized more recently by Larry Pesavento and Scott Carney (who coined the term Harmonic Analysis).
Many fine examples of Harmonic Patterns can be viewed at Pesaventos website:
tradingtutor.com
Scott Carneys Website: harmonictrader.com
An excellent tutorial on Gartley and Butterfly setups can be found at this site:
longorshort.com
While Harmonic Analysis has much in common with disciplines such as E-Wave and Astrologic Charting, it can stand alone as an analysis and trading method. (I do not practice either E-Wave or Astrological Analysis). As far as I know, I am the only practitioner of Harmonic Analysis who posts regularly on SI. I have been identifying and tracking Harmonic Patterns here, and on a private Yahoo Group, for about a year. Im starting this thread as a place to consolidate my work in this area, and to post future patterns that I identify.
The first half dozen or so posts here will revisit the patterns identified over the past year and track the markets followthrough once those patterns completed. This section can serve as sort of a Harmonic Analysis Primer for those looking for an introduction to this field of study. Later posts will be real-time identification and tracking of new patterns as they emerge.
While my focus is the stock indices, these patterns work in any tradeable, whether stocks, commodities, currencies, etc.
Table of Relationships
Key Ratio / Square / Square Root / Reciprocal
0.382 / -------- / 0.618 / 2.618
0.618 / 0.382 / 0.786 / 1.618
0.786 / 0.618 / -------- / 1.272
1.000 / 1.000 / 1.000 / 1.000
1.272 / 1.618 / 1.128 / 0.786
1.618 / 2.618 / 1.272 / 0.618
2.618 / -------- / 1.618 / 0.382
0.500 / 0.250 / 0.707 / 2.000
0.707 / 0.500 / 0.841 / 1.414
0.841 / 0.707 / -------- / --------
1.414 / 2.000 / -------- / 0.707
2.000 / 4.000 / 1.414 / 0.500
WATCH LIST as of 1/3/03
Date Symbol Pattern Timeframe PRZ Stop Target Status
1/1 LNCR Bullish Gartley Daily 30.25-30.80 29 33.4 Hit PRZ 12/27, reversed, nearing target
12/31 $BTK Bullish Butterfly Daily 330.6-335.9 NA 363 Hit PRZ 12/30, reversed
12/19 RFMD Bullish Butterfly Daily 7.65-7.86 7.00 10.30 Reversed up from stop level
12/15 $XAU Bearish Gartley Weekly 81.4-82.36 87.5 67.75 Approaching PRZ
12/9 BSX Bearish Bat Weekly 40.25-43.05 45.5 35 Back above PRZ
12/3 C Bearish Gartley Weekly 37.89-38.38 40 31.25 Exceeded PRZ, Reversed
12/2 MSFT Bearish Butterfly Weekly 58.4-60.5 62 49.17 Got within 2 points from target
12/3 CSCO Bearish Butterfly Daily 15.21-15.55 16 12.18 Came Near Target, reversed back up.
11/25 SUM* Bearish Gartley Weekly 335-450 NA -250 PRZ hit, reversed, retesting PRZ
*NYSE Summation Index |
