1 C
New York
Monday, February 26, 2024

Forex Trading Guide 2021: Pattern 5-0 Strategy

Pattern 5-0 is a simple pattern strategy that allows you to predict
reversals or, at least, a trend retracement with a fairly high accuracy .

Signs of a Bullish 5-0 Pattern

1. There was a bearish trend on the markets, directed from point O to point X;

2. There was a price correction on the XA segment;

3. After the correction, the price continues to decline (segment AB) to Fibo levels with a value of 113% -161.8%

4. Then the price performs a strong corrective movement to Fibo levels with a value of 161.8% -224%

5. Then there is a short downward movement, approximately 50% of the BC segment.

6.The final trend reversal occurred at point D

For the “Bearish 5-0 pattern” similar conditions, but for the bullish trend.

Position opening:

1. Determine the presence of a 5-0 pattern on the chart.

2. Having received point C, place a pending BuyLimit order (for a bullish signal pattern) or a SellLimit order (for a bearish signal pattern) at the level of point D, which is formed as a result of drawing a parallel channel at points ABC. Point D is usually at the 50% Fib level of the BC segment.

3. Stop-loss is set at the next Fibo level for 50% in case of a 38.2% or 23.6% rollback. The amount of the last indent depends on the time interval. The larger the spacing, the more indentation we provide.




Latest Posts

Don't Miss

Stay in touch

To be updated with all the latest news, offers and special announcements.