Concept
Butterfly
Butterfly is a Elliott & Harmonics concept. The Library holds 2 implementations, each one a working definition you can pull into Quant.
Top Butterfly indicators
2 total
.png&w=3840&q=75)
What is a Butterfly?
The Butterfly is an XABCD harmonic extension pattern associated with Bryce Gilmore and Larry Pesavento: unlike the Gartley or Bat, its D point completes beyond the X extreme. The common definition places B at a deep 0.786 retracement of XA, C at 0.382 to 0.886 of AB, and D at a 1.27 extension of XA, with 1.618 as the usual outer limit and an extended AB=CD often terminating in the same zone.
Because completion prints past the prior extreme, the Butterfly forms at fresh highs or lows: price runs the old extreme into the extension cluster, and traders watch that area for reversal. The placement makes it a tool for fading terminal moves and an unforgiving one when the extension keeps extending, which is why most treatments require confirmation at D and abandon the pattern beyond the 1.618 XA level.
How traders use it
- To fade terminal extensions: traders project the 1.27 XA level in advance, wait for price to spike beyond the old extreme into the zone, and look for rejection before positioning, with early targets at retracements of the AD swing.
- To frame failed-breakout ideas: a completion just beyond X resembles a run of the prior extreme, so some traders pair Butterfly completions with false breakout or sweep logic as confirmation.
- For invalidation discipline: the band between 1.27 and 1.618 of XA defines the tolerance; sustained trade beyond 1.618 voids the Butterfly, and the move is reassessed as a deeper extension structure or a plain continuation rather than a late completion.
Butterfly vs neighboring harmonic patterns
Crab: Both complete beyond X, but the Crab stretches to a 1.618 XA extension with a shallower B (0.382 to 0.618), while the Butterfly completes at 1.27 with a deep 0.786 B.
Gartley: The Gartley completes inside the XA leg at a 0.786 retracement; the Butterfly uses 0.786 at the B point instead and completes outside XA at an extension.
Related concepts · Harmonic patterns
Concept family
Elliott & Harmonics
33 concepts mapped · 17 in the Library
Butterfly FAQ
What is the difference between a Butterfly and a Gartley pattern?
Where D completes. The Gartley is a retracement pattern that finishes inside XA at the 0.786 level; the Butterfly is an extension pattern that finishes beyond X, typically at 1.27 of XA. A useful mnemonic: the Butterfly moves the 0.786 ratio up to the B point, and its completion prints a new extreme rather than a pullback.
Is the Butterfly pattern bullish or bearish?
Either, depending on orientation. A bullish Butterfly completes below the X low and is watched for a move up; a bearish one completes above the X high and is watched for a move down. The pattern only supplies a location and its invalidation. Direction comes from which side it completes on, and confirmation is still required because extensions can keep running.
Build Butterfly your way.
Quant writes, tests, and refines it with you — then it runs on LuxAlgo charting or ports to TradingView.