The Gartley Butterfly is a ZUP indicator that allows you to accurately determine the trend reversal in the market. Refers to universal professional models. It is rather difficult to use in work, but the efforts of traders are almost always very justified.
The ZUP indicator occurs very rarely and not every trader can notice it. When detecting “Butterfly Gartley” need to make a special markup. Please note that this can take a lot of time. Note that this indicator does not imply any clear limits in setting stop-loss and take-profit.
It is recommended to work with this model on higher timeframes — H1-D1. The figure is built with a broken indicator called ZigZag. When analyzing a formation, it is necessary to rely on Fibo levels. You should not forget about a number of features:
- The “Hartley Butterfly” occurs on the basis of the principle of the equality of two waves – AB and CD;
- D – at Fib level 78.6;
- B – at the Fibo level 61.8;
- As a result, the trader sees on the chart a technical analysis model that is visually very similar to the wings of a butterfly.
Remember that this indicator is activated at the extreme point of the rollback. This feature is the main advantage of the model.