Pitchforks, unlike trend lines, can provide a more accurate structure that coincides with market structure.
Pitchforks are best used on HTF for the best results.
What makes Pitchforks more reliable than trend lines, is the fact they have backtested statistics.
For example: If the third pivot of a PitchFork holds price, then there is an 80% probability to this the median line.
Furthermore, Pitchforks plotted on a HTF with confluence such as; Fibonacci and/or horizontal levels, can provide great TP and Entry levels.
Pitchforks, unlike trend lines, can provide a more accurate structure that coincides with market structure.
Pitchforks are best used on HTF for the best results.
What makes Pitchforks more reliable than trend lines, is the fact they have backtested statistics.
For example: If the third pivot of a PitchFork holds price, then there is an 80% probability to this the median line.
Furthermore, Pitchforks plotted on a HTF with confluence such as; Fibonacci and/or horizontal levels, can provide great TP and Entry levels.
While PitchForks are a basic tool, it is still important to know the correct pivots when adding this to your chart.
Be sure to use an asset chart with the most historical data for a more accurate drawing.
And as always, add confluence to such tools.
Continuing from PitchForks Part 1.
This tutorial will demonstrate Fibonacci PitchForks, PitchFan, and PitchForks being used alongside Elliott Wave Theory.
Key Points of the Lesson
UTILITY
Powerful tools combining price, time, targets and offering an invalidation.
Useful to build trading strategies and strong confluence.
Midline level is critical.
IMPLEMENTATION
Need 3 significant pivots.
Levels: median line, 1
Original Pitchfork
Use when we expect an impulse (Wave 3)
Schiff/Modified Schiff
Use when expecting a range (WXY corrective piece)
FIRST PRACTICAL EXAMPLE
FIBONACCI PITCHFORK
Need 3 significant pivots ⇒ high time frame preferred.
Levels:
0.236
0.382
0.5
0.618
0.786
1
1.272
1.618
2
Use internal Fib levels as entries and take profit levels ⇒ midline most relevant level.
PRACTICAL EXAMPLE - FIBONACCI PITCHFORK
PITCHFAN
Need 3 significant pivots ⇒ includes time aspects like the Fib Speed Fan.
Levels:
0.25
0.382
0.5
0.618
1
1.25
1.618
Each Fib level offers a high time frame confluence.
PRACTICAL EXAMPLE - FIBONACCI PITCHFAN
TIPS & TRICKS PITCH FORK STRATEGIES
1. Flat Price Action strategy ⇒ designed to fade a directional move.
Median line ⇒ rejection
Warning (outer line) ⇒ support / resistance
Possible to trade the S/R flip of the median line to another warning line.
2. Mini Median Line strategy ⇒ large and smaller Pitchforks.
Smaller Pitchforks constructed off the large Pitchfork.
Use significant pivots (such as SFPs) to build smaller pitchforks.
3. Price Failure strategy
Rally in a strong trend, but failure to reach the median line ⇒ expect a price reversal to follow later.
Pitchfork and Fibonacci Pitchfan together ⇒ strong confluence.
If the 3rd Pitchfork pivot + CC holds ⇒ 80% probability to reach the median line.
High time frame (4h+) Pitchforks and Pitchfans are the strongest.
TAKE HOME MESSAGE
Three pivots to build.
Midline is critical.
Pitchfan adds the time aspect.
Use together for confluence.