Butterfly Harmonic Pattern Indicator on TradingView - Free - [TradingFinder]

The Butterfly Harmonic Pattern is one of the advanced harmonic patterns used to identify price reversal zones (PRZ) with Fibonacci ratios.

This pattern consists offive key points: A, B, C, X, and D. Indicator highlights the D Point as the most critical part of this pattern as it typically has the highest potential for price reversal (PRZ).

Specification Table for the Butterfly Pattern Indicator

The specifications of the indicator are briefly outlined in the table below:

Indicators in Bullish Trends

In Bitcoin's (BTC) 3-hour chart, the bullish Butterfly Harmonic Pattern completes when the price reaches Point D in the Potential Reversal Zone (PRZ).

The price enters an uptrend at this point, forming consecutivehigher highs and higher lows. The indicator also issues a buy signal.

Indicators in Bearish Trends

In the EUR/USD pair's downtrend, the key points X, A, B, C, and D are identified. After the price reaches Point D, recognized as the Potential Reversal Zone (PRZ), Point BC corrects approximately 0.647 of the AB move.

The price enters a downtrend upon forming Point D, consistently creating lower and lower highs. At this stage, the indicator displays a sell signal.

Indicator Settings

Logical Setting

• ZigZag Pivot Period: Default value is 3
• Show Valid Format: Display only valid patterns
• Show Formation Last Pivot Confirm: Show confirmation for the last pivot
• Period of Formation Pivot: Default value is 2

Display Setting

• Show Bullish Pattern: Display bullish patterns
• Show Bearish Pattern: Display bearish patterns
• Color Bullish Pattern: The default color is blue
• Color Bearish Pattern: The default color is blue
• Width Line: Default line thickness is 1
• Label Size: Adjustable label text size
• Switching Colors Theme Mode: Adjust the chart background theme

Alert

• Alert: Notifications when a pattern is detected
• Alert Name: Customizable alert name
• Message Frequency: Content of the alert message
• Show Alert Time by Time Zone: Displays alert time based on the selected time zone

Conclusion

With the formation of Point D as the Potential Reversal Zone (PRZ), the price enters a new trend, which can continue either upward or downward.

This pattern is designed for traders to identify price reversal zones and enter trades with minimal risk. The Fibonacci points in this pattern are precisely calibrated to intelligently highlight price movements and reversal points.