ZigZag Harmonic Patterns with Fibonacci Entry and Exit Levels

Summary

This experimental strategy uses ZigZag swings to form a sequence of price pivots, then checks their relative distances against ratio ranges for patterns such as Bat, Gartley, Butterfly, Crab, Shark, and ABCD. It can use an alternate timeframe and Heikin Ashi candles. When a recognized bullish or bearish pattern meets the entry-window condition, orders are opened; Fibonacci-derived levels define take-profit and stop-loss exits. A second target is optional and requires pyramiding to be enabled manually.

The document supplies parameters and a BTC/USDT futures backtest configuration for a one-hour chart with 15-minute base data, but gives no interpretable performance results. It explicitly warns that the strategy repaints after reload and that its results are heavily curve-fitted. Those limitations make historical signals and backtest outcomes unreliable evidence for live trading. Pattern recognition depends on ZigZag pivots, which can change as later prices arrive, and the many adjustable ratios and target settings add further scope for overfitting.

Key ideas

• The strategy classifies ZigZag swing sequences using harmonic-pattern ratio ranges.
• Bullish and bearish pattern conditions can trigger entries within a Fibonacci-based entry window.
• Fibonacci levels are used to specify take-profit and stop-loss conditions, with an optional second target.
• The document warns that signals repaint after reload and that results are heavily curve-fitted.
• The published backtest setup does not provide performance evidence that resolves those limitations.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.