BAT ADVANCED FORMATION IDENTIFICATION RULES
Bat Tools:
*Fibonacci retracements (0.382%, 0.5%, 0.618% and 0.886%).
Bat Timeframes:
*The Bat Advanced formation was originally designed as a swing trading strategy. But it also works on lower timeframes.
Bat Tactics:
*Seek to identify 4 market moves that form M-type or W-type formation. Turning points of these formations form the points (X, A, B, C, D) that fulfill the formation. M-type should appear in the bottom of a downtrend. W-type should appear in the top of an uptrend.
Bat rules of engagement: Criteria 1
Bat rules of engagement: Criteria 2
Bat rules of engagement: Criteria 3
The Bat Advanced formation starts with an impulse leg/anchor leg that establishes our X and A points.
Once X and A points have been identified, we then look for our first criteria.
Criteria 1: The market forms the B completion point by fulfilling at least a 50% retracement of the XA leg.
Note: AB move remains valid as long as there is at least a 50% retracement of XA and that it does not touch the 61.8% retracement of XA. Only candlewick is calculated here. Candle close is not important.
If Criteria 1 has been met, then look for Criteria 2.
Criteria 2: The market forms the C completion point by fulfilling at least a 38.2% retracement of the AB.
Note: BC move remains valid as long as there is at least a 38.2% retracement of AB and that it does not touch the 88.6% retracement of AB. Only candlewick is calculated here. Candle close is not important.
Variations: BC move remains valid as long as there is at least a 38.2% retracement of AB and that it does not touch the A. Only candlewick is calculated here. Candle close is not important.
If Criteria 1 and 2 have been met, then look for Criteria 3.
Criteria 3: The market forms the D completion (entry point) by fulfilling a 88.6% retracement of XA.