Quick q about the ab=cd pattern

Hey guys,

Im currently reading ‘trade what you see’, learning about the abcd pattern at the mo, just wondering, with alot of the charts ive seen illustrated, the pattern that is drawn onto the chart (the zigzag) doesnt actually line up exactly with the high (or low) at point c and even more so with point d. Is this because point d is just and estimation of where the price will probably go? If this is the case this is understandable at point d but not at point c…

Hey naughtypip.

its been some time since my last post as i mainly just observe the forums here occasionally but its been awhile since you’ve posted this without reply.

hopefully you’ve found your answer if not then here is my explanation.

Now just to clarify there are 3 different ABCD patterns, the most common and basic of the 3 is the AB=CD pattern, the other two are the classic and extension, the classic ABCD uses the 61.8% or 78.6% fibo level for point BC and the 127.2% and 161.8% fibo levels for the CD extension whereas the extension uses the 127.2% and 161.8% extension levels of point AB for points CD irrespective of BC parameters.

The point of the AB = CD pattern is the distance in terms of pips or time between the two points. for example point A to B is 100 pips thus you can expect point C - D to be about 100 pips or point A to B is 12 hours thus you can expect point C to D to be about 12 hours, the actual price level of the highs and lows play no part in the equation, the price levels of the highs and lows only play a part in the other ABCD, gartley or butterfly patterns where fibonacci is used.

i hope this has answered your question :slight_smile: