HARMONIC PATTERNS

                                         HARMONIC PATTERNS:

Content from Below Book: 

BOOK: The Harmonic Trader  

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1. Everyone knows that October historically has been a troubling month for the major markets.
2. particularly evident when several harmonic calculations converge at a specific price area to define critical support or resistance. This area is known as the Potential Reversal Zone.
3. The Key to utilizing these harmonic measures when analyzing a price chart is to determine the area where the greatest amount of calculated rations congregate.
4. When three, four or even five numbers come together within a specific area as defined by their respective structure, you must respect the high probability for some type of reversal.

                                                                    RULES

• Bigger the Pattern, the more significant the potential reversal ( Example : Weekly chart)
• If a PRZ contains four or five numbers, the area should be considered  very harmonic. If the price action reverse from this area, the PRZ could be considered as an important turning point. BUT if the price action doesn't reverse it worked indicate that the predominant trend is quite strong. 
• To determine valid reversals and to optimize trade executions. These skills require consistent dedication to research past harmonic examples and to analyze current set-ups.
• Price Gap in the PRZ occurs most frequently and is the strongest of all the warning signals. A price gap is an extremely significant indicator of an invalid setup and has kept me out of my bad trade