I continue to debate models Gartli based on Fibonacci numbers (see «butterfly effect» in the number 24 and «Harmony models» to number 32). The more I work with these models, the more comfortable I feel with them. I am also very impressed with the way even the partial formation of the model may be useful in the trade. Even if the finished model Gartli can often predict the length and direction of the next movement, partial compliance (building) wave C often can be useful as a definition of the entrance to the market in the short (with bull Gartli model) and in the long position (with the bear model Gartli).
Before we proceed to model «Three steps», let's look at a good model Gartli formed on the schedule ES.
Bull model Gartli: 5-minute schedule ES
As you can see, the model Gartli to be present at any time scale - here it is formed at the 5-minute schedule, and provides almost perfect conditions for opening a long position after the completion of the model at point D at around 864.75.
Let us briefly see how it was built:
- The movement from point X to point A was restored to 61.8%, to form a point of B.
- After that, the movement from point A to point B was restored to 61.8%, to form a point of C. We can see a perfect symmetry.
At this point, even if the model Gartli is not yet finished, you can open a short position based on the spread model. Open positions will be based on the fact that the next movement down to the formation of a D will continue below the point B. So, you check the following restoration of movement from point X to point A and find that the recovery of 71.6% is located in an area marked 864.75. There should be little mathematical calculations:
1. Calculates C - B = 7.75.
2. Then multiply the value obtained for several standard Fibonacci extensions, such as 1.27, 1.41, 1.618, etc., and then subtracts the results of the maximum at point C. By multiplying the value of 7.75 to 1.27, we obtain the value 9.84, which will then deduct from the price point C, which gives us the final tick 864.91 - this is almost exactly 78.6% of th recovery point X to point A.
Therefore, you are making the assumption that the roll below the point B to stay in the area marked 865, and you're hoping to close their short position here, if you opened it, and go a long way, if you find it a turn. Expected strong movement from the point D must be at least 61,8% of the traffic between point C and point D, and, in our example, this area has been successfully achieved and even exceeded.
Model «three-step»
Strict interpretation of this model lies in the fact that we have three waves of equal magnitude with a certain and equal to the restoration and extension of the Fibonacci for each wave. However, later in this article I will cite an example, which, as I thought, denies the need for strict interpretation. Traders familiar with Elliott Wave analysis, looking at this model will see some similarities with the 5-wave model, in which the first and fifth waves are of equal length. Represents the general scheme, as this model looks like.
Top Bull model «Three steps» (3 waves down) below the bear's model «Three steps» (3 wave up).
Bull and bear model «Three steps»
This model, like all models, gives you the potential to predict future price movements. Also note that if the wave 3 ends, or on a strong horizontal support / resistance, or the key Fibonacci level of recovery for the traffic, the reliability of the model increases.
The concept is fairly simple and has some similarity with the usual model Gartli above. Movement of prices is restored, and if you notice that the reconstruction is close to the standard level in the Fibonacci 61.8%, then you have a top model. The following graph shows the beginning of the model on the market ES, where the price reached a mark of 830.50, showing recovery of 61,8% of the initial upward movement.
Wave 1 bear model «Three steps»
The following graph shows how you keep doing the same thing as the previous example for the next two waves upward. You can see how the wave 2 is adjusted to 61.8% just as a wave 1.
The complete model of «Three steps»
Please note that each of the waves up to a Fibonacci extension from the previous wave. You can see that by performing the same calculation, as shown in the previous example for the standard model Gartli with consideration of movement from point C to point D.
Thus, for the first wave, we take the value of the wave 1 and subtract the value of rehabilitation, like the following:
Step a: 842.75 - 830.50 = 12.75.
Then, we multiply the value obtained for the extension of the Fibonacci 1.27:
Step b: 12.75 * 1.27 = 16.19.
Now, we add this value to the largest reconstruction wave 1:
Step c: 830.50 + 16.19 = 846.69.
The final model of «Three steps»
You can see that the wave 2 has ended at a maximum at around 847, exactly as predicted in the computation. Maximum wave 3 has deviated slightly from the calculations on this one, but it is quite a small discrepancy. Why is this pattern called bearish model «Three steps»? As soon as we receive our complete model, we can now say that after this we should get a turn, at least 61,8% of the maximum wave 3. The following graph shows that we were originally, followed by a strong spurt, followed by a major sale.
Bear Model «Three steps»
When you find the perfect model of «Three steps», there is a high probability that you can enter into a transaction based on the projected goal of 61.8%. I've seen several examples of how this model is formed and repeated at the top. Meaning that the waves roll 3 is 61.8%, which leads to expansion of the wave 4 to 127%, exactly the same as in previous waves. You can then enter into another transaction of the maximum wave 4 for the restoration of 61.8%.
However, such perfection and symmetry is not very often present in the markets, and we should be able to cost some not at all ideal versions of the model. I personally believe that the imperfect version of this model may be useful for speculative transactions.
For example, look for the next bull graphics model «Three step», which are relevant recovery Fibonacci, but do not look symmetrical, like the previous charts.
Schedule bull model «Three steps»
As soon as wave 3 was formed, you can open a long position to capture the expected recovery in 61.8% of the last downward movement, which formed wave 3. The final movement has actually profit from the recovery in 78.6% of the minimum wave 3.
The final timetable bull model «Three steps»
If you want to be conservative in using this model, you'll probably have to wait a while to find the perfect setting for the entrance to the market. However, if you allow some of the assumptions in its view of the recognition of patterns, you can very often benefit from this model.
Supplement model «Three steps»
Price formed a good model of «Three steps», went to the calculated objective to restore the level of 61,8% of wave 3 and then continued to build yet another wave, which I observed as a wave 4. This wave should also perform a further recovery at 61.8% and, in fact, carried out much more because of GEPa down. You can also view this as a fourth wave of enlargement, which led to extreme price, required a great retrogression.
Also, please note that the first movement upwards, there was only 50,0% th recovery and, therefore, this peak is not observed as a wave 1. However, if you decide that 50.0% is quite good for you and you're going to celebrate it as a wave 1, then you might begin to make deals for the expected recovery of one wave earlier than the observed wave 3. If you were to do it, I found a purpose in 50,0% and 61,8% are not in until you form a true model of «Three steps».
This is a rather simple model for visual perception, even without drawing a line and, therefore, represents a very realistic graphics for the formation of practical application in commerce.
Before we proceed to model «Three steps», let's look at a good model Gartli formed on the schedule ES.
Bull model Gartli: 5-minute schedule ES
As you can see, the model Gartli to be present at any time scale - here it is formed at the 5-minute schedule, and provides almost perfect conditions for opening a long position after the completion of the model at point D at around 864.75.Let us briefly see how it was built:
- The movement from point X to point A was restored to 61.8%, to form a point of B.
- After that, the movement from point A to point B was restored to 61.8%, to form a point of C. We can see a perfect symmetry.
At this point, even if the model Gartli is not yet finished, you can open a short position based on the spread model. Open positions will be based on the fact that the next movement down to the formation of a D will continue below the point B. So, you check the following restoration of movement from point X to point A and find that the recovery of 71.6% is located in an area marked 864.75. There should be little mathematical calculations:
1. Calculates C - B = 7.75.
2. Then multiply the value obtained for several standard Fibonacci extensions, such as 1.27, 1.41, 1.618, etc., and then subtracts the results of the maximum at point C. By multiplying the value of 7.75 to 1.27, we obtain the value 9.84, which will then deduct from the price point C, which gives us the final tick 864.91 - this is almost exactly 78.6% of th recovery point X to point A.
Therefore, you are making the assumption that the roll below the point B to stay in the area marked 865, and you're hoping to close their short position here, if you opened it, and go a long way, if you find it a turn. Expected strong movement from the point D must be at least 61,8% of the traffic between point C and point D, and, in our example, this area has been successfully achieved and even exceeded.
Model «three-step»Strict interpretation of this model lies in the fact that we have three waves of equal magnitude with a certain and equal to the restoration and extension of the Fibonacci for each wave. However, later in this article I will cite an example, which, as I thought, denies the need for strict interpretation. Traders familiar with Elliott Wave analysis, looking at this model will see some similarities with the 5-wave model, in which the first and fifth waves are of equal length. Represents the general scheme, as this model looks like.
Top Bull model «Three steps» (3 waves down) below the bear's model «Three steps» (3 wave up).
Bull and bear model «Three steps»
This model, like all models, gives you the potential to predict future price movements. Also note that if the wave 3 ends, or on a strong horizontal support / resistance, or the key Fibonacci level of recovery for the traffic, the reliability of the model increases.
The concept is fairly simple and has some similarity with the usual model Gartli above. Movement of prices is restored, and if you notice that the reconstruction is close to the standard level in the Fibonacci 61.8%, then you have a top model. The following graph shows the beginning of the model on the market ES, where the price reached a mark of 830.50, showing recovery of 61,8% of the initial upward movement.
Wave 1 bear model «Three steps»
The following graph shows how you keep doing the same thing as the previous example for the next two waves upward. You can see how the wave 2 is adjusted to 61.8% just as a wave 1.The complete model of «Three steps»
Please note that each of the waves up to a Fibonacci extension from the previous wave. You can see that by performing the same calculation, as shown in the previous example for the standard model Gartli with consideration of movement from point C to point D.
Thus, for the first wave, we take the value of the wave 1 and subtract the value of rehabilitation, like the following:
Step a: 842.75 - 830.50 = 12.75.
Then, we multiply the value obtained for the extension of the Fibonacci 1.27:
Step b: 12.75 * 1.27 = 16.19.
Now, we add this value to the largest reconstruction wave 1:
Step c: 830.50 + 16.19 = 846.69.
The final model of «Three steps»
You can see that the wave 2 has ended at a maximum at around 847, exactly as predicted in the computation. Maximum wave 3 has deviated slightly from the calculations on this one, but it is quite a small discrepancy. Why is this pattern called bearish model «Three steps»? As soon as we receive our complete model, we can now say that after this we should get a turn, at least 61,8% of the maximum wave 3. The following graph shows that we were originally, followed by a strong spurt, followed by a major sale.Bear Model «Three steps»
When you find the perfect model of «Three steps», there is a high probability that you can enter into a transaction based on the projected goal of 61.8%. I've seen several examples of how this model is formed and repeated at the top. Meaning that the waves roll 3 is 61.8%, which leads to expansion of the wave 4 to 127%, exactly the same as in previous waves. You can then enter into another transaction of the maximum wave 4 for the restoration of 61.8%.
However, such perfection and symmetry is not very often present in the markets, and we should be able to cost some not at all ideal versions of the model. I personally believe that the imperfect version of this model may be useful for speculative transactions.For example, look for the next bull graphics model «Three step», which are relevant recovery Fibonacci, but do not look symmetrical, like the previous charts.
Schedule bull model «Three steps»
As soon as wave 3 was formed, you can open a long position to capture the expected recovery in 61.8% of the last downward movement, which formed wave 3. The final movement has actually profit from the recovery in 78.6% of the minimum wave 3.The final timetable bull model «Three steps»
If you want to be conservative in using this model, you'll probably have to wait a while to find the perfect setting for the entrance to the market. However, if you allow some of the assumptions in its view of the recognition of patterns, you can very often benefit from this model.
Supplement model «Three steps» Price formed a good model of «Three steps», went to the calculated objective to restore the level of 61,8% of wave 3 and then continued to build yet another wave, which I observed as a wave 4. This wave should also perform a further recovery at 61.8% and, in fact, carried out much more because of GEPa down. You can also view this as a fourth wave of enlargement, which led to extreme price, required a great retrogression.
Also, please note that the first movement upwards, there was only 50,0% th recovery and, therefore, this peak is not observed as a wave 1. However, if you decide that 50.0% is quite good for you and you're going to celebrate it as a wave 1, then you might begin to make deals for the expected recovery of one wave earlier than the observed wave 3. If you were to do it, I found a purpose in 50,0% and 61,8% are not in until you form a true model of «Three steps».
This is a rather simple model for visual perception, even without drawing a line and, therefore, represents a very realistic graphics for the formation of practical application in commerce.
Vlada Raysevik
www.esignal.com
www.esignal.com
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