The Bullish Gartley Strategy
The Bullish Gartley Strategy is based on the retracement strategies that were outlined by H.M. Gartley in his 1935 book. There are two versions of this strategy: bullish and bearish. In today’s article, we will talk about the bullish component of this strategy.
Top UK Forex Brokers
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Pepperstone offers ultra-competitive forex spreads averaging 0.12 pips on EUR/USD in the Razor account, accompanied by a diverse portfolio comprising 100+ currency pairs - an extensive selection surpassing most competitors. Additionally, Pepperstone distinguishes itself by offering three currency indices (USDX, EURX, JPYX), not commonly found among alternative platforms. Pepperstone has now won our annual 'Best Forex Broker' award twice.
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CMC presents an extensive array of 300+ forex pairs characterized by tight spreads and rapid executions, surpassing the offerings of many competitors in terms of currency diversity. Forex indices also present a fairly unique and holistic way to speculate on the value of key currencies like the USD, EUR and GBP.
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FXCC's key selling point is its forex trading conditions. ECN spreads come in as low as 0.0 pips during peak trading hours, while it supports a wider range of currency pairs than the majority of rivals with over 70 forex assets. Additionally, you have access to MT4, which was built specifically for forex trading and excels for its charting tools.
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Vantage offers 55+ currency pairs - above the industry average, so experienced traders can explore plenty of opportunities. Vantage's deep liquidity pool provides forex spreads from 0.0 pips in the ECN account, lower than many alternatives. There are also no commissions, deposit fees or hidden charges.
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IC Markets maintains its commitment to providing exceptionally tight 0.0-pip forex spreads on major currency pairs such as EUR/USD. This makes it an excellent option if you are seeking superior execution, with an average of 35 milliseconds. Additionally, if you are a high-volume trader, you can benefit from rebates of up to $2.50 per forex lot.
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Ingot Brokers offers forex trading on a modest suite of 30+ currency pairs with raw spreads on the MT5 platform. There are also no restrictions on short-term trading strategies, including hedging, scalping and the use of Expert Advisors (EAs).
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Scope Markets offers 40+ major, minor and exotic currency pairs. Although the range is average, experienced traders can access very high leverage up to 1:2000. Additionally, the broker’s proprietary terminal delivers advanced analysis tools, including a live forex heatmap.
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Trade 50+ forex pairs, including popular major, minor and exotic pairs. This is a decent selection, but traders will have a choice between the attractive MT4, MT5 or IRESS platforms and regulatory cover from ASIC. The VPS will also suit automated forex trading strategis.
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Anzo Capital offers 45+ forex pairs including majors, minors and exotics with fast execution and spreads starting from zero. High leverage up to 1:1000 is available with a margin call at 80% and a stop out level at 50%.
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I think the range of 60+ major, minor and exotic currency pairs is fairly competitive, especially with spreads from 0 pips in the Pro account. Experienced traders can also access high leverage up to 1:500 in the popular MT4 platform.
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Binary and OTC options can be purchased on 40+ currency pairs, with 55+ currency pairs available if you deposit $1000. Typical payouts are reasonable at 81% and the $1 minimum trade makes the broker accessible to new forex traders. There is also access to the MT4 and MT5 platforms for experienced forex traders.
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4xCube offers 60+ currency pairs with competitive trading conditions. We like that all trading strategies are permitted including scalping and hedging.
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RoboForex offers trading on 30+ currency pairs, trailing category leaders like Pepperstone with its 90+ forex assets. That said, the Prime and ECN accounts feature competitive average spreads of 0.1 pips on the EUR/USD. Additionally, with a minimum investment of $100, traders can utilize the CopyFX system to replicate the strategies of seasoned currency traders.
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SimpleFX provides a comprehensive selection of around 60 currency pairs, from majors like GBP/USD to exotics like CHF/PLN. Forex trading fees are competitive, averaging 0.9 pips on EUR/USD during testing, while MetaTrader 4, available on desktop, web and mobile, was built specifically for trading currencies online.
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EagleFX provides opportunities to go long or short on over 50 forex pairs from majors to exotics, with competitive spreads as low as 0.1 pips. The broker offers the leading charting software, MetaTrader 4, which delivers a host of charting tools for traders, including 9 timeframes and over 30 indicators.
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FXDD continues to offer a leading selection of 90+ currency pairs with ECN pricing. Spreads are decent, coming in at 0.4 pips for EUR/USD during testing. That said, these quotes aren’t as narrow as top competitors like Pepperstone.
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Trade on 45+ majors, minors, crosses and exotics, with competitive pricing, ultra-fast execution and no requotes. Newer traders can access zero-commission trading. Experienced forex traders can operate with no trading restrictions and benefit from an ECN account and a VPS service.
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FP Markets stands out as an excellent option for forex traders, boasting a selection of over 70 currency pairs covering a wide range of currencies, especially since expanding its choice of exotics. With average spreads of just 0.1 on the EUR/USD in its Raw account, the broker provides competitive pricing for traders.
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Trade 80+ major, minor and exotic forex pairs. This is a very competitive range of currency pairs with 50+ exotics to choose from, and traders will benefit from fast execution and support from extra features including a pip calculator. The MetaTrader 4 software was also designed for online forex trading.
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Established in 2005, FXOpen is a multi-regulated broker that has attracted over 1 million traders. Designed for active trading, it provides access to a growing selection of more than 700 markets and supports high-frequency trading, scalping, and all forms of algorithmic trading using expert advisors (EAs).
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Hantec Markets offers a limited range of 30+ forex pairs – less than most top brands, including Pepperstone with 100+. That said, market execution is rapid based on tests, and spreads are competitive starting at just 0.2 pips. This, combined with access to the popular MT4 platform with 30+ technical indicators, ensures a relatively complete trading experience for short-term currency traders.
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With 60+ currency pairs available, Dukascopy offers enough majors, minors and exotics to keep most forex traders happy. The broker also offers high leverage up to 1:100 – a good amount to see from a reputable and regulated broker. Currency traders have access to excellent software, including MT4 and JForex.
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ThinkMarkets offers 46 currency pairs, which is around the industry average. Forex traders can benefit from tight 0.0-pip spreads for EUR/USD during peak market hours. Additionally, the ThinkTrader proprietary platform offers an impressive 125+ technical indicators - ideal for complex forex strategies.
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FXTM stands out with a strong selection of over 60 currency pairs, surpassing many competitors like AvaTrade. It also stands out with its six currency indices for traders aiming to diversify their forex portfolios, while the ECN account offers ultra-competitive spreads starting at 0 pips on majors, along with low commissions of just $3.50 per lot.
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easyMarkets offers 60+ major and minor currency pairs but no exotics. Forex traders will appreciate the access to the industry’s leading software MT4, paired with the broker’s fixed spreads from 0.7 pips on EUR/USD, offering a degree of price certainty.
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Fusion Markets offers an excellent selection of 90+ currency pairs, providing a range of short-term trading opportunities. It continues to excel for its ultra-tight spreads from 0.0 pips and exceptionally low commissions of $2.25 per side. You also get access to leading forex software in MetaTrader 4.
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FXCM offers an average range of 40+ currency pairs, although there are no commissions and spreads are competitive from 0.78 pips for EUR/USD. The broker also offers 3 forex baskets covering USD, Yen and emerging markets benchmarks.
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InstaForex's range of 100+ currency pairs is among the largest we have seen. ECN spreads are also available from 0.0 pips with zero commissions. Minimum deposits start from $1 making the broker accessible for beginners. You can also access market-leading forex analysis and insights.
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Trade 200 CFD forex pairs with DMA pricing and tight spreads, ultra low latency and high leverage up to 1:1000. The range of forex pairs available and pricing model are among the most attractive in the African market.
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Capital.com offer a long list of forex CFD pairs for trading. All have competitive spreads. The firm also ensures negative balance protection
The bullish Gartley pattern is a complex chart pattern that aims to use points of downward price retracement as a way of identifying a possible upward price reversal point. The bullish Gartley pattern is a bullish reversal chart pattern.
As is seen from the simplified sketch above, the bullish Gartley pattern resembles an inverted “W”. The pattern should be able to show an XABCD formation as shown above if correctly traced. The pattern is traced by connecting the points with trend lines as follows:
– It starts with a bullish move from point X to a point A.
– There is a short retracement from point A to point B.
– The uptrend resumes again to point C. Point C is not usually on the same level as point A).
– There is a downward move from point C to point D. This completes the bullish Gartley.
If a trader can correctly trace the bullish Gartley pattern on the charts, he can cash in on the full reversal that is sure to occur from the point D.
Rules for the Bullish Gartley Strategy
Central to the use of this strategy is the identification of the bullish Gartley pattern from the currency chart. There are rules that must be followed in order to identify a true bullish Gartley pattern, as it is very easy to get caught out by many fake outs or fake patterns that resemble a bullish Gartley but which are really something else.
These rules have to do with being able to detect a true XABCD pattern and are listed below:
1) The price move that is represented by the AB line must be a 61.8% retracement of the price movement represented by the XA line. The dotted line XB should therefore show the 61.8% reading (please refer to the diagram above).
2) The next move following AB is the resumption of the uptrend. This is represented by the line BC. The BC price movement should be an upward retracement of between 61.8% and 78.6% from the price movement AB. In other words, point C must be below point A on a horizontal plane. If point C is at the same horizontal plane as point A or even above point A, the chart pattern rule for the bullish Gartley is invalidated.
3) Next in line is the downward price retracement from point C, represented by the line CD. CD must be 127% to 161.8% retracement from line BC. This means that point D MUST be below point B, but remain above or at the same horizontal plane as point X.
It is only when the rules above have been clearly obeyed that a true bullish Gartley pattern has formed and we can truly say that the trader has a good basis for going long at point D.
Traders should be very alert to pattern failures. It is best to practice the identification of this pattern on a demo account before attempting it on a live account.
Indicators
This strategy uses a single indicator which is a customized indicator that helps the trader to plot the XABCD lines. This indicator is known as the . Once you have downloaded this indicator, attach it to the Indicators folder of your MT4 trading client, then attach it to the chart when you open your MT4 platform and it will automatically plot the lines as shown in the chart above. Click here to download the indicator.
Time Frames
This strategy can be used on any time frame and for any currency pair.
Setting Stop Loss and Profit Target
There are no hard and fast rules for setting the stop loss targets and the profit targets. For the stop loss, the key is in identifying when the point D has been reached so as not to get stopped out if prices are still retracing. Once the point D has been clearly identified, the stop loss can be set at a set number of pips beyond it, taking into cognisance the time frame used in doing the trade analysis. For instance, it is unrealistic to set a 40 pip stop loss if the analysis was done on a daily chart, seeing the wide difference in pips between the key points.
Profit targets will depend on using technical parameters like support/resistance levels, candlestick reversal points or even news trades that may counter the trade.