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Glossary · Pro tools

Harmonic patterns

Price swings whose lengths match Fibonacci ratios, grouped into named shapes like the Bat and the Crab.

Why it matters

Each pattern has five turning points, X, A, B, C and D. When the swings line up with a pattern’s ratios, its numbers point to a price zone where the move may reverse.

How to read it

Cluenex shows patterns that are still forming as well as finished ones. For each live pattern you get the zone, the price that cancels it before it gets there, the stop limit where it fails, and targets 1 and 2 if it works. Read the zone as a level to watch, not a signal: wait for the price to react there. In Cluenex’s own test, calls at harmonic zones did slightly worse than calls without them.

Also called: harmonics, XABCD, pending pattern, forming pattern

Related

Potential reversal zoneThe price band where a harmonic pattern’s separate measurements agree.Gartley patternA harmonic pattern where B retraces 0.618 of XA and D completes at 0.786 of XA.Bat patternA harmonic pattern where B retraces 0.382 to 0.50 of XA and D completes at 0.886 of XA.Butterfly patternA harmonic pattern where B retraces 0.786 of XA and D extends to 1.27 of XA, beyond X.Crab patternA harmonic pattern whose D stretches to 1.618 of XA, the most extreme of the set.

In the Cluenex app, this explanation opens next to every harmonic patterns figure, with the live reading for the stock you are looking at. Open it in Cluenex