Trading System for Dragon Pattern - Entry, Stop-loss, and Target Rules

• Pattern Identification:

• Draw a Dragon pattern on the price chart.

• The Dragon pattern consists of two symmetrical triangles converging into a wedge shape.

• The pattern typically occurs during a trend reversal.

Draw the dragon pattern as per the fib ratio which is mentioned in the screenshot.

Trading Dragon Pattern

• Head Formation of "first leg." Hump (must be 0.38 to 0.5 of AB).

• "Second leg" (can be 0.61 8 to 1.27 of AB).

• Trend line "breakout" (Long Trigger).

Alert the pattern formed with time and coordinates, target and stop loss.

Draw the entry, stop loss and target lines as shown in image. 

• Bullish Entry Rules:

• Enter a long position when the price breaks above the upper trendline of the Dragon pattern.

• And wait, that supertrend is Green.

• Bearish Entry Rules:

• Enter a short position when the price breaks below the lower trendline of the Dragon pattern.

• And wait, that supertrend is Red.

• Stop-loss Rules:

• For a bullish trade:

• Place the stop-loss order below the lower leg of the Dragon pattern.

• For a bearish trade:

• Place the stop-loss order above the upper leg of the Dragon pattern.

• Target Rules:

• Set the target level based on Fibonacci retracement levels as an input.