Harmonic Patterns TEST

The Harmonic Patterns TEST indicator identifies potential and confirmed ABCD harmonic patterns based on pivot point analysis. It provides real-time visual projections for future pattern completion zones, helping traders anticipate market reversals before they occur.

Usage

The script is designed to detect the classic ABCD harmonic structure. When valid points A, B, and C are identified, the tool projects a "Possible ABCD" scenario. In this phase, it plots two horizontal boundaries (D- and D+) which represent the minimum and maximum price levels where point D must form for the pattern to be valid.

If the price reaches a pivot point within this zone, a confirmed ABCD pattern is identified. The indicator then:

• Plots the full geometric shape of the harmonic pattern.
• Displays Take Profit (TP) levels based on Fibonacci ratios (0.382, 0.618, and 1.272 by default).
• Labels the pattern, including a specific "AB=CD" notation if the time duration of the legs is equal.

Traders can use the "Possible ABCD" arrows and zones to set alerts or limit orders in anticipation of a reversal at point D.

Details

The script utilizes a built-in ZigZag logic to filter market noise and identify significant swing highs and lows. It measures the relationship between price legs using Fibonacci retracements and extensions. Specifically, it looks for point C to retraces between 0.618 and 0.786 of leg AB, and point D to complete at a 1.272 to 1.618 extension of leg BC.

Because the script relies on Pivot Points, which require a certain number of bars to confirm a high or low, the pattern confirmation will naturally occur with a slight lag. The "Possible" feature mitigates this by showing the required range for point D in advance.

Settings

ZigZag & Margins

• 'NO WICK': When enabled, the script uses the higher of open/close for highs and lower of open/close for lows instead of wicks.
• Minimum % Change: Sets the percentage threshold required for a new ZigZag leg to form.
• Error Marge: Adjusts the sensitivity/tolerance for Fibonacci ratio calculations (default ranges 0.9 - 1.1).

Patterns & Display

• Show 'Possible ABCD': Toggles the visibility of the projected D- and D+ zones.
• Show Drawings: Enables the plotting of the geometric triangles and connection lines.
• Linewidth: Customizes the thickness of the pattern legs and connection lines.

Levels & Targets

• Show TP Lines: Displays Take Profit targets once a pattern is confirmed.
• TP level Ratios: Allows selection of different Fibonacci levels (0.236, 0.382, 0.5, 0.618, 0.786, 1, 1.272, 1.618) for the three target lines.

FAQ

How do I use the "Possible ABCD" feature?

When points A, B, and C are established, the script draws two white arrows and horizontal lines. You should look for a price reversal (Pivot Point) to occur specifically within the vertical space between those two lines to confirm a valid trade setup.

Why do some patterns disappear or only show in Replay?

TradingView has a limit on the number of lines and labels a single script can draw. As new patterns form, older ones are removed from the chart. Using the "Bar Replay" tool allows you to see historical patterns that may have been cleared.

How can I access Harmonic Patterns TEST?

You can get access on the LuxAlgo Library for charting platforms like TradingView, MetaTrader (MT4/MT5), and NinjaTrader for free.