Written by:
Patrick Mikula CTA
Mikula Forecasting Company
www.MikulaForecasting.com
support@MikulaForecasting.com
Copyright © 2009 by Patrick Mikula All Rights Reserved
On the picture below, the Gartley pattern has been applied to the September 2009 Cocoa chart. This article will discuss a Gartley pattern failure that was previously discussed in article 17. Click here to read that article. In article 17, I showed examples of the price falling after the pattern failure. In this example I will show the price rising after the pattern failure.
The Gartley pattern is complete when the price reaches point D that is usually defined as AB=CD. In some cases the price will fall from point C, a percent represented by one of the Fibonacci ratios and then stop falling. The price of cocoa fell 0.786 percent down from point C and stopped falling. The price then turned up. This means the price failed to fall to point D. When the price fails to reach point D and turns up around a Fibonacci number, the price should rally. On the chart below, the price rallied after the Gartley pattern failure. After the Gartley pattern failure, the first price target is the top point C and then the top point A.
Gartley Pattern
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