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Chart Patterns

ABCD Pattern

A four-point chart pattern (A-B-C-D) where the CD leg mirrors the AB leg, giving a predictable entry at point C.

What is the ABCD Pattern?

The ABCD pattern is a foundational chart pattern consisting of four price points:

  • A: the starting point (beginning of the move)
  • B: the first swing high (or low)
  • C: the pullback (retracement of AB, typically to the 38.2-61.8% Fibonacci level)
  • D: the completion point where CD ≈ AB in distance

Trading the ABCD

The trade entry is at point C, anticipating the move to D. The pattern works because the CD leg tends to mirror the AB leg in both distance and time. Set your target at the projected D point and stop loss below C.

Related Terms

Fibonacci Retracement

Horizontal levels at key Fibonacci ratios (23.6%, 38.2%, 50%, 61.8%) that identify potential support and resistance.

Swing Trading

A strategy of holding positions for days to weeks, capturing medium-term price swings.