Perfect ABC Bullish Setup
January 7, 2010 12:06 PM

PerfectABCBullish_Jan0710
ES1220_Jan07102

A Perfect ABC Bullish is the best way to trade ABC Patterns. This morning @ES produced a Perfect ABC Bullish pattern on 1220 Tick chart. The result was excellent. Here is the description of the ABC Pattern.

1. Overnight (Globex session) produced a range of 1127 to 1134 in @ES, and traded relatively in steep downtrend. At the opening bell 9.30am ET, from the Globex Low of 1137, ES traded higher near the POC level of 1132. This produced the first leg (AB).

2. The Globex Low was printed outside the Fib. Bands. This may have been the first clue for a Perfect ABC. But completion of AB Leg may be stronger indication.

3. Price closed above the mid-Fib Band. This confirms the ‘B’ swing point.
4. Around 10am, market reversed and sold off to 1128 forming ABC Pattern. This setup has all inclinations of Perfect ABC, since A formed outside the Fib. Band, B- Above mid Fib. Band and ‘C’ is forming within the AB leg and completed at least 62% retracement.

5. Now to trade this ABC, I need price closing above the EL. EL was also near the strong cluster of pLow, S1 (1129 – 1130). If Price closes strongly above this range, it is a PERFECT ABC and can be traded upto 100% of its AB Range to 1133. Second Target may be set for 162% of AB at 1136.
6. About 10.45am, Price reached 1133 to make about 3.5 points profit.
7. Next target is set at 162% of AB at 1136.

ABC Bullish
Fib. Bands
Globex Pivots

Comments

4 Responses to “Perfect ABC Bullish Setup”

  1. ryan on January 11th, 2010 1:32 am

    Hi Suri,

    How is EL calculated? What is it based on?

    Thanks.

  2. test on January 11th, 2010 10:53 am

    Hi Song,

    EL is a dynamic calculation using the AB and BC ranges. The EL value is
    selected from a series of calcs on the type of ABC (size, angles etc.)
    It could be as simple as n-Bar High+ORB to a complex calc using
    Volatility of the last N-Bars to determine the 'C' turn level.

    Regards,
    Suri

  3. Ryan on January 11th, 2010 8:11 pm

    Hi Suri,

    Thanks for the explanation.

    Regards
    Song.

  4. Ryan on January 12th, 2010 2:11 am

    Hi Suri,

    Thanks for the explanation.

    Regards
    Song.