Harmonic Trading: Profiting from the Natural Order of the Financial Markets, Volume 1

Financial Times
Scott M. Carney  
Total pages
April 2010
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Harmonic Trading: Profiting from the Natural Order of the Financial Markets, Volume 1


If you're looking for a powerful, proven approach to technical analysis that can demonstrate proven effectiveness, you're looking for Harmonic Trading. Now, the creator of this remarkable approach has written the definitive introduction to using it in your own trades. Scott Carney, President and Founder of HarmonicTrader.com, shows how harmonic trading combines Fibonacci measurement strategies with advanced pattern recognition analysis, unlocking valid market signals as if they were the combination to a safe. Carney presents natural harmonic patterns that consistently identify critical price levels and market turning points: patterns analogous to the predictable behavior of natural systems. Next, he presents a comprehensive plan for applying Harmonic Trading in real trades. You'll find examples from U.S. equities, currencies, commodities and foreign markets; for both short- and long-term timeframes; and in all markets, including 2008's extraordinarily bearish environment. Harmonic Trading has rapidly grown in recent years, and is now widely recognized as a premiere technical analysis discipline. This book presents the state-of-the-art - including strategies and techniques that will be completely new to most traders and investors. Carney guides traders gently up the learning curve, sharing personal experiences and presenting over 100 pages of clear illustrations. The result is a book that makes Harmonic Trading techniques more widely accessible than ever before.


Presents harmonic patterns that identify stock market turning points: patterns analogous to the predictable behavior of natural systems.


  • The definitive guide to the fast-growing trading discipline of Harmonic Trading, authored by its creator, Scott Carney.
  • Combines powerful Fibonacci measurement and pattern recognition techniques to unlock profit opportunities you can't uncover any other way.
  • Includes 100+ pages of charts and illustrations that demonstrate Harmonic Trading in a wide spectrum of markets.
  • Table of Contents

    Introduction 1

    Chapter 1 Harmonic Trading 7

    Chapter 2 Fibonacci Numbers 11

    Chapter 3 Pattern Identification 35

    Chapter 4 The AB=CD Pattern 41

    Chapter 5 The Bat Pattern 71

    Chapter 6 The Gartley Pattern 97

    Chapter 7 The Crab Pattern 121

    Chapter 8 The Ideal Butterfly Pattern 149

    Chapter 9 Trade Execution 171

    Chapter 10 Price Action in the Potential Reversal Zone (PRZ) 185

    Chapter 11 The Harmonic Trade Management System 203

    Chapter 12 Pattern Violations 233

    Conclusion 251

    Bibliography 253

    Index 255

    Back Cover

    The Definitive Introduction to Harmonic Trading--By the Originator of This Approach, Scott Carney!


    “I have always found it fascinating that, in the field of securities analysis, so few important gains have been made in the body of knowledge since the 1920s and 1930s. There are a small number of modern-day pioneers among us who must be sought out. Scott Carney is one of those pioneers who has devoted himself to the task of uncovering the hidden logic in the movements of the markets. Harmonic Trading: Volume 1 provides a system of critical decision-making based on the natural order of life, which allows investors to replace emotions and guesswork with logic and symmetry so necessary to becoming a successful investor.”

    -- PAUL DESMOND, President of Lowry Research Corporation


    “I am well aware of the author’s dedication and degree of excellence in his work. Scott has not only thoroughly researched and covered the subject well, he has taken that most important step of showing you how to use these tools and apply them to your trading and investing. I currently oversee the management of more than $3 billion in assets using a technical model. I know firsthand that a trading methodology that does not have buy, sell, and trade-up rules will never be successful. Every effort needs to be made to make the process free of subjectivity. Harmonic Trading will help you organize your trading and keep you in sync with the markets. No one has done this better than Scott.”

    --GREG MORRIS, Chief Technical Analyst, Stadion Money Management, and author of Candlestick Charting Explained and The Complete Guide to Market Breadth Indicators


    Harmonic Trading creator Scott Carney unveils the entire methodology to turn patterns into profits. These strategies consistently identify the price levels and market turning points that reveal the natural order within the chaos of the financial markets. Analogous to the predictable behavior of many of life’s natural processes, Harmonic Trading examines similar relationships within the financial markets to define profitable opportunities in an unprecedented manner. Carney introduces new discoveries such as the Bat pattern, Alternate AB=CD structures, the 0.886 retracement, and more. These strategies are entirely new to the trading community, and they represent a profound advancement beyond all other Fibonacci methodologies!


    After you’ve discovered how to identify harmonic patterns, Carney presents a complete methodology for applying them in trade execution and handling them throughout the entire trade management process. From savage bear to rampaging bull, Harmonic Trading can be employed in all markets--equities, currencies, commodities, and foreign markets--for both short- and long-term timeframes.


    Scott Carney, President and Founder of HarmonicTrader.com, has defined a system of price pattern recognition and Fibonacci measurement techniques that comprise the Harmonic Trading approach. He has named and defined harmonic patterns such as the Bat pattern, the ideal Gartley pattern, and the Crab pattern. He is the author of three books: The Harmonic Trader (1999), Harmonic Trading of the Financial Markets: Volume One (2004), and Harmonic Trading of the Financial Markets: Volume Two (2007). In 2005, Carney joined A.I.G. Financial Advisors as a Registered Investment Advisor. He has since left A.I.G. Financial Advisors after two years to start his own firm. In addition, Carney is a full member of the Market Technicians Association (www.mta.org) and the American Association of Professional Technical Analysts (www.aapta.us). He has been a regular columnist on several well-known websites, such as StockCharts.com, TradingMarkets.com, and eSignal.com. Carney is a featured guest on CNNfn, and he presents seminars nationally.

    Reader Review(s)

    "To be useful, a trading methodology must be understood.  Simplicity is a bonus. Harmonic Trading: Profiting from the Natural Order of the Financial Markets, Vol. 1 by Scott M. Carney succeeds on both counts. This first volume of a promising series on harmonic trading will benefit traders seeking to improve their models."  

    --George A. Schade Jr., CMT, Stock Futures and Options, January 2011.