Crab Pattern

The "Crab" pattern was invented by Scott Carney of Harmonic Trading in 2000. The Crab pattern is another form of the 5-point Gartley extension pattern. The Crab pattern has a distinct extension: 1.62 of XA swing. Crab patterns also have a 0.618 XA retracement to form the center retracement "B" level. The Potential Reversal Zone (PRZ) is formed at 1.27 of AB swings, 1.62 of XA and a distinct 2.62 to 3.62 of BC. These extension patterns form when prices trade outside of XA swing. When the price closes below X, the pattern may be signaling a further correction to 1.62 of XA level to form "Crab" pattern.

Trade: Once the Crab pattern is completed at the PRZ level, look for price-action to confirm the reversal. For bullish Crab patterns, look for a "wide range bar" or "higher highs" from the PRZ level to confirm the Crab pattern. Enter a "long" trade above the confirmation bar. For bearish Crab patterns, enter a "short" trade below the low of the confirmation (lower low) bar.

Stop: The bullish Crab pattern fails if prices close below the PRZ levels. Place a "stop" order below the low of the PRZ level. For bearish Crab patterns, place a "stop" order above the high of the PRZ levels.

Target: The bullish Crab patterns result in excellent profits. Set targets at "B", "C" and "A" levels. Similarly, for the bearish Crab patterns set targets at "B", "C" and "A" levels.

Bullish Crab

AB = 0.618 XA XD = 1.618 XA BD = 2.28-3.14 XA

802.00 800X0 798.00 796.00 794.00 792.00 ■790.00

1/18 13X0 1/19 14X0 1/22

802.00 800X0 798.00 796.00 794.00 792.00 ■790.00

1/18 13X0 1/19 14X0 1/22

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Responses

  • Arabella
    How to trade on bearish crab pattern?
    7 years ago

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