Gartley Pattern

AAA

DEFINITION of 'Gartley Pattern'

In technical analysis, it is a complex price pattern based on Fibonacci numbers/ratios. It is used to determine buy and sell signals by measuring price retracements of a stock's up and down movement in stock price.

Gartley Pattern


Source: www.harmonictrader.com

INVESTOPEDIA EXPLAINS 'Gartley Pattern'

The above Gartley example shows an uptrend XA with a price reversal at A. Using Fibonacci ratios, the retracement AB should be 61.8% of the price range A minus X, as shown by line XB. At B, the price reverses again. Ideally, retracement BC should be between 61.8% and 78.6% of the AB price range, not the length of the lines, and is shown along the line AC. At C, the price again reverses with retracement CD between 127% and 161.8% of the range BC and is shown along the line BD. Price D is the point to buy/sell (bullish/bearish Gartley pattern) as the price is about to increase/decrease.

RELATED TERMS
  1. Bear

    An investor who believes that a particular security or market ...
  2. Cup and Handle

    A pattern on bar charts resembling a cup with a handle. The cup ...
  3. Head And Shoulders Pattern

    A technical analysis term used to describe a chart formation ...
  4. Fibonacci Numbers/Lines

    Leonardo Fibonacci was an Italian mathematician born in the 12th ...
  5. Technical Analysis

    A method of evaluating securities by analyzing statistics generated ...
  6. Retracement

    A temporary reversal in the direction of a stock's price that ...
Related Articles
  1. Advanced Channeling Patterns: Wolfe ...
    Active Trading Fundamentals

    Advanced Channeling Patterns: Wolfe ...

  2. Continuation Patterns: An Introduction
    Charts & Patterns

    Continuation Patterns: An Introduction

  3. Advanced Fibonacci Applications
    Active Trading

    Advanced Fibonacci Applications

  4. The ADX Shows Strong Uptrends In These ...
    Chart Advisor

    The ADX Shows Strong Uptrends In These ...

comments powered by Disqus
Hot Definitions
  1. Letter Of Credit

    A letter from a bank guaranteeing that a buyer's payment to a seller will be received on time and for the correct amount. ...
  2. Due Diligence - DD

    1. An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to ...
  3. Certificate Of Deposit - CD

    A savings certificate entitling the bearer to receive interest. A CD bears a maturity date, a specified fixed interest rate ...
  4. Days Sales Of Inventory - DSI

    A financial measure of a company's performance that gives investors an idea of how long it takes a company to turn its inventory ...
  5. Accounts Payable - AP

    An accounting entry that represents an entity's obligation to pay off a short-term debt to its creditors. The accounts payable ...
  6. Ratio Analysis

    Quantitative analysis of information contained in a company’s financial statements. Ratio analysis is based on line items ...
Trading Center