Each pattern has both a bullish and bearish version. Bullish patterns help identify higher probability opportunities to buy, or go "long. Each turning point A, B, C, and D represents a significant high or significant low on a price chart. These points define three consecutive price swings, or trends, which make up each of the three pattern "legs.
Trading is not an exact science. As a result, we use some key Fibonacci ratio relationships to look for proportions between AB and CD. Doing so will still give us an approximate range of where the ABCD pattern may complete—both in terms of time and price. This is why converging patterns help increase probabilities, and allow traders to more accurately determine entries and exits. A demo account is intended to familiarize you with the tools and features of our trading platforms and to facilitate the testing of trading strategies in a risk-free environment.
Results achieved on the demo account are hypothetical and no representation is made that any account will or is likely to achieve actual profits or losses similar to those achieved in the demo account. Conditions in the demo account cannot always reasonably reflect all of the market conditions that may affect pricing and execution in a live trading environment.
Please let us know how you would like to proceed. Reflects the common, rhythmic style in which the market moves. Helps identify trading opportunities in any market forex, stocks, futures, etc. Highest probability trade entry is at completion of the pattern point D. Helps to determine the risk vs.
Convergence of several patterns—within the same timeframe, or across multiple timeframes--provide a stronger trade signal. Develop a thorough trading plan for trading forex. Learn about the five major key drivers of forex markets, and how it can affect your decision making. Our forex analysts give their recommendations on managing risk.More...