Butterfly
HarmonicNeutralReversalReliability:
An extension harmonic where D projects BEYOND point X (around 1.272 of XA), marking a reversal at an overextended zone.
Description
B retraces ~0.786 of XA; D completes at 1.272–1.618 of XA (beyond X) with a 1.618–2.618 BC extension. Because D lies outside X, the reversal zone sits at a price extreme.
Market psychology
Price breaking past X feels like a breakout, but the extended Fibonacci cluster shows it is often an exhaustion point.
How to trade
Wait for a clear reaction at D (beyond X) with confirmation; the stop sits further beyond D. Risk discipline matters because D is an extreme zone.
Confirmation
D reaches 1.272 of XA, aligns with the BC extension cluster, and shows a reversal trigger.
Also known as: Butterfly pattern
Educational content only — not financial advice. Cryptorua reads public market data and never places orders.