Thursday, April 24, 2014

Day Trading The Three Hills And Mountain Pattern;

In today’s trading tutorial we are going to discuss one of our most powerful trend-following patterns we use every day in our Live Trade Room, called the “Three Hills and Mountain Pattern.”

This pattern is quite rare, so when we find this pattern on our charts we KNOW this is almost a guaranteed winning trade.

The Three Hills and Mountain Pattern has a close relationship to Elliot Wave Pattern Analysis, and uses Fibonacci Retracements and extensions to find the correct entry price as well as profit-targets.

Three Hills and Mountain Pattern

“One of the reasons we LOVE trading with this pattern is that we can find the trade AFTER it feels like you missed the move.”

Just when you think you missed the trade you will see it pull back into the trigger-zone and you have a second chance to make your money!

Day Trading with Three Hills and Mountain Pattern is very easy.

Find the Three Hills:
Start looking for the three hills; each hill will retrace at least 50% of the prior swing-high.

Find the Mountain:
After you find the three hills, then measure your Fibonacci retracement tool from the low of the first hill (A) all the way to the high of the third hill (B), and begin to wait for the price action to pull back to the 50% retracement of the (A) to the (B) move.

Three Hills and Mountain Pattern Chart

Find the Entry:
The entry is triggered with a bullish reversal-candle at the 50% retracement of points A to B.  Learn more about precision entries here.

Place your stop-loss:
Place the stop-loss below the low of the mountain, which is called the (C) point of the pattern.  Remember, the stop-loss is triggered when a candle closes below this level.

Place your profit-target(s):
Profit-targets are easy with this pattern.  The first profit-target goes at the (B) point, and the second profit-target is used at the (D) point, which is the same length as the (A) to (B) move.  In other words, A-B = C-D. 

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