HOW TO TRADE: The Crab Pattern and The Deep Crab Pattern - Harmonic Ratios and Explanation

The Crab Pattern The Crab is a Harmonic pattern discovered by Scott Carney in 2001. He has defined all of the harmonic patterns such as the Bat pattern, the ideal Gartley pattern, the 5-0, the Shark, the Crab pattern and many others. In addition to these discoveries, Scott created many other strategies that comprise the Harmonic Trading approach, including the RSI BAMM, 38.2% Trailing Stop, the Potential Reversal Zone, the theory of Fibonacci ratio convergence, the Alternate AB=CD patterns, the perfect harmonic pattern alignments, the Harmonic Trading Execution Plan, the harmonic impulse structures, the 88.6% ratio and the 1.13% ratio (with Jim Kane of KaneTrading.com), other alternate harmonic patterns and many other trading discoveries never before presented.

The critical aspect of this pattern is the tight Potential Reversal Zone created by the 1.618 of the XA leg and an extreme (2.24, 2.618, 3.14, 3.618) projection of the BC leg but employs an 0.886 retracement at the B point unlike the regular version that utilizes a 0.382-0.618 at the mid-point. The pattern requires a very small stop loss and usually volatile price action in the Potential Reversal Zone.