Chart pattern: Difference between revisions

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{{Short description|Pattern within a chart when prices are graphed}}

[[File:Triangle-ascending.jpg|thumb|Ascending triangle pattern]]

A '''chart pattern''' or '''price pattern''' is a [[pattern]] within a [[chart]] when prices are graphed. In stock and [[commodity market]]s trading, chart pattern studies play a large role during [[technical analysis]]. When [[data]] is plotted there is usually a pattern which naturally occurs and repeats over a period. Chart patterns are used as either reversal or continuation signals.

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Traders use the Potential Reversal Zone (PRZ) as an important level of support/resistance in their trading and price action strategy.

== Geometric Bullish/Bearish ABCD Patterns© ==

In the ever-evolving field of technical analysis, pattern recognition continues to be a cornerstone of effective trading strategy. Among the myriad of chart formations available, the ABCD pattern stands out for its simplicity and reliability. However, not all ABCD patterns are created equal. This article introduces a refined and modernized version known as the Geometric ABCD Pattern ©—a copyrighted methodology that blends classic pattern recognition with the power of geometry and Fibonacci alignment.

== What is the Geometric ABCD Pattern ©? ==

The Geometric ABCD Pattern © is a proprietary enhancement of the traditional ABCD harmonic pattern. While the conventional pattern relies primarily on basic price symmetry, this geometric version applies precise angle and ratio relationships derived from Fibonacci mathematics and human behavior. It’s designed not only to improve the accuracy of entry and exit decisions, but also to provide traders with a structural context for the market’s price behavior.

In essence, the Geometric ABCD Pattern © represents a higher-probability setup identified through both objective price action and subjective behavioral geometry.

== The Anatomy of the Pattern ==

Like its classic counterpart, the Geometric ABCD Pattern © is built on four key points:

* '''Point A:''' The start of the impulse leg

* '''Point B:''' The termination of the impulse and start of a retracement

* '''Point C:''' The end of the retracement leg, ideally falling between 61.8% and 78.6% Fibonacci retracement of AB

* '''Point D:''' The final leg, completing the pattern at an extension typically between 127.2% and 161.8% of the BC leg

What distinguishes this version is that the triangle formed by connecting these points must also visually align with specific geometric angles and ratios—often forming elegant shapes such as isosceles or equilateral triangles, which serve as vibrational clues to market intent.

== How to Spot the Geometric ABCD Pattern © ==

# '''Start with an Impulse Move:''' Identify a strong, clean price move that can be labeled as the AB leg.

# '''Measure the Retracement:''' Use Fibonacci retracement tools to find the 61.8% or 78.6% levels. The price should respect this range to mark Point C.

# '''Draw the Triangle:''' Connect Points A, B, and C to visualize the triangle. Check for symmetry and clean angle geometry.

# '''Project Point D:''' Use the Fibonacci extension tool to mark where the CD leg would complete at 127.2%–161.8% extension.

# '''Confirm the Setup:''' Look for confluences like support/resistance zones, divergence, or volume confirmation.

== How to Trade the Pattern ==

Once the pattern is confirmed:

* '''Entry:''' Enter at or slightly before Point D.

* '''Stop Loss:''' Place the stop slightly beyond Point D extension or under the previous swing low (for bullish setups).

* '''Take Profit:''' Use a 1:2 or 1:3 risk/reward ratio, often targeting the midpoint between C and D, or a Fibonacci retracement of the AD leg.

The best Geometric ABCD setups often emerge at major turning points—highs or lows of swing moves, or when multiple timeframes align.

== Why It Works ==

The pattern is rooted in the psychology of collective market behavior. Fibonacci levels represent natural human reactions to risk and reward. When geometric angles align, it reflects a resonance or vibrational harmony that often precedes a reaction. Traders trained to recognize these setups begin to understand not just what the market is doing—but why it’s doing it.

== The Role of GittoGPT ==

Traders seeking to learn and apply the Geometric ABCD Pattern © benefit from AI mentorship through GittoGPT™—an AI-powered financial trading mentor created by Professor Kenny Simon and powered by Bretton Financial Trading Academy. GittoGPT is designed to walk traders through the visual geometry, emotional coherence, and trade execution required to apply the pattern correctly and consistently.

== Conclusion ==

The Geometric ABCD Pattern © represents a fusion of tradition and innovation in chart pattern analysis. By combining classical harmonic principles with geometric precision and psychological insight, it gives traders an edge that is both visual and strategic. As financial markets continue to evolve, it’s this kind of integrated thinking that keeps traders ahead of the curve.

== Candlestick pattern ==