Harmonic’s – What they are and how I use them
Forex Signals: https://blackswanfx557171195.wpcomstaging.com/forex-signals/
Indices Signals: https://blackswanfx557171195.wpcomstaging.com/indices-commo…
Forex Trading Robot: https://blackswanfx557171195.wpcomstaging.com/trading-robot/
Link to Folder: https://drive.google.com/file/d/1_ar3…
Link to Cheatsheet: https://docs.google.com/document/d/1-…
Harmonics are a result of natural orderflow of the market, I use harmonics on the higher time frames to give me a directional BIAS/to use as a potential PRZ (Potential reversal zone) with other confluences, I don’t just take trades from the D point specifically.
TOP TIPS
Choose one and become good at it, don’t attempt to learn them all at once.
My favorites are 👇
– Shark
– Crab
– Butterfly
The reason for this is because I like extension patterns, with LTF/wick confirmation they’ll payout 90% of the time.
(Mainly because they’ve broke previous structure, are sitting on a psychological level and need to retrace)
The easiest way to learn how to start seeing these naturally/without thought, is to pick one and back test it on the charts using the tradingview harmonic tool, use higher timeframe to start, you’ll find price is less choppy and they’re easier to see + the higher the time frame, the stronger the potential PRZ will be at the D point.
D point’s of harmonics ideally should land on some form of supply/demand (This gives you x2 confluences) we then use the lower time frames/wicks to confirm our entries.
X
A
B
C
D
X Point is the origin of the Harmonic (The starting point)
A,B,C,D Are the following measurements that create the harmonic with the D point being the potential PRZ.
B point retracement (Potential projections)
38.2 (Bat, Shark, Crab)
50% (Bat or shark)
61.8% (Shark/Crab)
78.6% (Butterfly)
88.6% (Deep crab)
Once price starts breaking below/above the B point you then want to start projecting ahead of time towards the D point! (This is when you can look to trade the C=D leg but that’s for another video)
If you’re not sure on the pattern DON’T TRADE IT, Always be patient and wait for something obvious to show up!
Why throw money into the market if you’re unsure? We’re here to make money not gamble.
LTF Entries/wicks at the D point
You want see 3/4 candles of reaction close to the D point before entering (Wicks above and candles failing to break the highs) We can then zoom down and look for internal breaks of structure (CHoCH, break in momentum or some form of schematic) Zooming down is not essential but helps as you become more advanced, but in the beginning it’s easier to just keep things simple.
Timing is crucial here, you will see this mostly happen during the London/NY open/sessions.
Taking Profits
For profit targets using harmonics, always use the A-D measurement OR target previous high/lows, try to make sure your R:R is at least 1:1 and set your profit targets slightly below the fib measurements/previous structure because you’ll find that price sometimes gets close and rejects just before. (Meaning you’d miss out on you’re profits)
TOP TIP
You can use the Weekly/previous weekly/Monthly high/lows as D point confluences too.
If you see a D point completion landing in a strong unmitigated supply/demand zone that’s also landing on the current/previous weekly high/low, you’ve got a strong probability that price will reverse from this level, all you need to do then is be patient and wait for the LTF set up or wick rejection.
(Wait for price to tell you where it’s going, don’t try force price to go where YOU want it to go)
D Point confluence entry checklist
Did the pattern complete ✔️
Was the pattern on 15m or above ✔️
Did you get the 3/4 wicks during London/NY session ✔️
Did the pattern complete inside a S/D zone ✔️ (HTF the better)
Did the pattern complete on a strong support/resistance ✔️ (Weekly/low or high etc…)
You only need one of the bottom 2 to be confirmed for 4 confluences.