Product review: Harmonic Pattern Collection by S&C Staff
DIVERGENCE SOFTWARE, INC.
PO Box 12021, Burke, VA 22009-2021
Phone: 703 690-1744
Product: Pattern-detection add-in software for eSignal
System requirements: eSignal v.11 64-bit, Windows 7 or 8; 32GB RAM recommended
Want to trade using harmonic patterns such as Gartley, butterfly, or crab? The biggest problem is just finding them. Divergence Software, a third-party eSignal developer, has the answer. Harmonic Pattern Collection is an eSignal add-on that comes with nine watchlist-based pattern indicators and nine chart-based pattern indicators. Typical usage would be to monitor a basket of securities for pattern activity using the watchlist indicators and then link the watchlist to a chart that has the corresponding chart pattern indicators loaded. When a new potential or pending pattern is identified on the watchlist, just click on that watchlist row and the actual pattern information will be displayed in the linked chart.
If you’re not familiar with the class of patterns called harmonic patterns, here’s a quick overview. It is based on the premise that if price movements occur in a series of changes that have a Fibonacci relationship, once the pattern completes, you can have some idea of where price will move. Figure 1 is called a bearish butterfly pattern. At point D, which is the conclusion of the pattern, you expect that price will turn down, and in this example it does.