This article will provide some ideas of managing buy and sell orders in Forex trading with the Pattern Compltion Interval in Harmonic Pattern. Many harmonic pattern trader use some arbitrary order management. Some uses Fibonacci levels but they are not able to measure or think how each winning and losing trades can affect their trading balance. You do need to know this to grow your capital safely. Risk and Order management is not the concept you can skip regardless of your trading strategy. So how can we manage buy and sell orders when we are trading with harmonic patterns like Gartley Pattern, Butterfly Pattern, Bat Pattern, Crab Pattern, Cypher Pattern, 5-0 Pattern ? The simple and effective way is to use Pattern Completion Zone. Pattern Completion Zone is a trading zone around Point D of Harmonic Pattern. In Harmonic Pattern, Pattern Completion Zone can help you to achieve the desired Reward to Risk ratio, which is the most important success factor for your trading.
Pattern Completion Interval (=Pattern Completion Zone) was introduced in the Book: Guide to Precision Harmonic Pattern Trading to help you to trade with harmonic pattern with more scientific risk management. Of course, you can find more details about the Pattern Completion Interval from the book.
Here is one of many approaches how you may use the Pattern Completion Interval concept for your trading. Of course, this approach is compatible with your Harmonic Pattern Plus and Harmonic Pattern Scenario Planner. We produce this diagram so you can understand this approach intuitively without any calculator in your hands. Tr = Take Profit Ratio and Sr = Stop Loss Ratio. The diagram shows the case of two orders but you can even generate more orders taking this example further. Hopefully this new diagram is easier to understand than previous one.
Of course, this precision trading frame work is inclusive to our Harmonic Pattern Indicators including Harmonic Pattern Plus and Harmonic Pattern Scenario Planner and X3 Chart Pattern Scanner. These indicators are available for both MetaTrader 4 and MetaTrader 5 platforms.
Image and article originally from www.mql5.com. Read the original article here.