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Nicola Delic Ultimate Pattern Strategy

Welcome to
Ultimate Pattern Strategy

Ultimate Pattern Strategy (U.P.S) is one of the simplest, yet still


extremely powerful part of Elliott Wave Theory. After spending years
using Elliott Wave as my only trading strategy, I wanted to share a few
patterns that everyone can find in very short amount of time and make
profitable trades every day. In this manual you are going to learn two
patterns that will help you become a better trader instantly.

U.P.S. is the strategy that’s going to work on any instrument (Forex,


Stocks, Commodities) and on any time frame (1min, 1h, 1d, 1month).
Therefore, it’s going to fit everyone’s lifestyle.

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Bullish Pattern Overview


Ultimate Bullish Pattern is first of two patterns you need to understand
in your quest to become a better trader. Our pattern consists of five legs
that develop after we see the end of downwards price action. We are
going to use labels A-B-C-D-E to keep track of where we are in the
market currently.

On the image above, you can see how our pattern should look on the
chart. The easiest way to learn how to spot this pattern would be to watch
for Highs & Lows in the market.

Leg A is your first high after the end of downtrend.

Leg B is the first pullback against the leg A. We need to see ending of leg
B above the starting point of leg A, so this would be Higher Low.

Leg C is push in a direction of leg A, but we need to see the end point of
this leg below the ending point of leg A, so this is going to be your Lower
High.

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Leg D will represent the pullback after leg C and all time we need to hold
above the ending point of B.

Leg E represents strong momentum that breaks above the ending point
of leg A, so this leg will be your higher high.

Bullish Pattern Rules

1. Leg B needs to end above the starting point of leg A


2. Leg C needs to end below the starting point of leg A
3. Leg D needs to end above the ending point of wave B

After all 3 conditions have been met, we can start trading the
Bullish Pattern.

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How To Trade Bullish Pattern


Trading Bullish pattern is easier than you can even imagine, once you can
spot the leg D developing, just draw a trendline between ending points of
legs A and C.

We are going to use breakout as our Entry Point. That means we need to
see a candle close above the trendline.

Stop Loss will be ending point of B wave, we know that if we are right
wave D needs to hold above the ending point of wave B and that’s why
this is going to be our stop loss. For target level we are going to use
inverse 161.8% of leg B, to get this level we are going to use Fibonacci
retracement tool and draw from start to end of leg B.

To get full idea of how to trade Bullish pattern take a look at image below
where you can see where to put your Entry / Stop Loss / Target levels.

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Quick Tip #1:

Try to trade only setups that give you 1:1 or even better Risk Reward and
try to trade with our Breakout Trader tool that was designed to help you
getting in and out at the right time!

Quick Tip #2:

Move Stop Loss to break even after wave E reach inverse 123.6% of wave
B. This way we can create risk free trade.

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Bearish Pattern Overview


Since market will never move in just direction, we need to learn Ultimate
Bearish Pattern, that’s our second and final pattern you need to learn
today. Again our pattern consist of five legs that develop after we see the
end of upwards price action. We are going to use labels A-B-C-D-E to
keep track where we are in the market currently.

You can see on picture above how our pattern should look on the chart,
the easiest way to learn spotting this patterns would be to watch for
Highs & Lows in the market.

Leg A is your first low after the end of uptrend.

Leg B is the first pullback against the leg A,we need to see ending of leg
B above the starting point of leg A, so this would be Lower High.

Leg C is push in a direction of leg A, but we needs to end this leg below
the ending point of leg A, so this is going to be your Higher Low.

Leg D will represent pullback after leg C and all time we need to hold
above the ending point of B, this would be your Lower High.

Leg E represents strong momentum that breaks above the ending point
of leg A so this leg will be your lower low.

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Bearish Pattern Rules:

1. Leg B needs to end above the starting point of leg A


2. Leg C needs to end below the starting point of leg A
3. Led D needs to end above the ending point of wave B

After all 3 conditions have been met, we can start trading the
Bearish Pattern.

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How To Trade Bearish Pattern


Trading Bearish pattern is going to be same as we are trading Bullish
pattern, once you can spot the leg D developing, just draw a trendline
between ending points of legs A and C. We are going to use breakout as
our Entry Point. Stop Loss will be ending point of B wave, we know that if
we are right wave D needs to hold above the ending point of wave B and
that’s why this is going to be our stop loss For target level we are going to
use inverse 161.8% of leg B, to get this level we are going to use
Fibonacci retracement tool and draw from start to end of leg B. To get full
idea of how to trade Bullish pattern take a look at picture [#] where you
can see where to put entry / stop / target levels.

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Quick Tip #1:

Try to trade only setups that give you 1:1 or even better Risk Reward and
try to trade with our Breakout Trader tool that was designed to help you
getting in and out at the right time!

Quick Tip #2:

Move Stop Loss to break even after wave E reach inverse 123.6% of wave
B. This way we can create risk free trade.

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Bullish Trading Example

On the chart of the EURUSD above we can see that our “Ultimate Pattern
Scanner” found a bullish pattern, but we need to check few things before
we decide if we should trade or not. First we need to follow the rules,
wave B needs to be smaller than wave A, wave C needs to be smaller
than wave B, wave D needs to be smaller than wave C, this three rules
was all valid so we can buy breakout of the trend line that our tool
automatically drawn for us. For Target point we picked up inverse 161.8%
of wave B (we got that level after we draw Fibonacci retracement from
start to end of wave B) and for stop loss we are going to use the ending
point of wave B.

This trade was successful and EURUSD managed to reach target after
only one candle.

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Bearish Trading Example

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Bullish Trading Example

GBPJPY showed us a nice bullish ultimate pattern at the start of October,


after our indicator gave us popup notification our job was just to double
check if everything was correct. After we double check everything we got
that wave B was smaller than wave A, Wave C was smaller than wave B
and wave D was smaller C, so all rules was fine. We started with long
position after red trend line was broken, stop loss at the end of wave B (if
you have fibo that’s your 0 level) and for targets we used inverse 161.8%
of wave B. After three and half hours of waiting the GBPJPY pair
managed to close our long position with 50 points target.

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Bearish Trading Example

For our second bearish example we are going to look at GBPJPY on 30min
chart. After our indicator alerted us that we have potential bearish pattern
developing we need to check the rules. Wave B was smaller than wave A,
wave C was smaller than wave B and wave D was smaller than wave C.
After all rules matched our criteria we start to watch the breakout of
green trend line as our potential sell setup. For stop loss we are going to
use ending point of wave B and for target we are using inverse 161.8% of
wave B. This trade took around 7h to complete and reach our target but
it’s definitely worth waiting for nice profit of 70 points.

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Trading Tips
Making money constantly in the market require iron discipline, so you
really need to pay attention on this couple of useful tips I’m going to
share with you here.

Tip #1 – Define Your Trading Style

You need to define your trading style based on yourself. We have two
important trading styles types: Day Trader and Swing Trader. Day
Trading is the fast trading style where you open and close few positions
every day while Swing Trading is slightly slower style where you open and
hold positions from few hours to few days. I can’t say which of this
trading styles are better since I traded both and both made me nice
profit, but I can suggest that if you have a day job go with Swing Trading
since you’ll get time to trade and still make some profit, and pick day
trading if you have 3-4 hours per day to spend infront of screen.

Tip #2 – Select Time Frames

Our pattern strategy will work on any time frame, but you should select 1
time frame that suits your trading style. For day traders try to pick 5min
or 15min as your defult TF and if you are swing trader pick between 1h
and 4h charts. This time frames showed me best results so far and after
you select your time frame try to watch and trade only on that time
frame, don’t just from TF to TF.

Tip #3 – Always Control Risk

Most traders lose money due bad money management, so I want you to
be different, I want you to use risk management as pro. Every trade that
you take needs to have same risk value and I strongly suggest that you

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go with 1-3% for your trades. For all traders with account above 10,000 I
would suggest to pick between 1-2% and for traders that have below
10,000 pick between 2-3%. Let’s look me for example I have account
larger than 10,000 so each my position will be 1% and always 1%!

Having defined risk maybe seems like we are limiting our profit, but at the
same time we are limiting our self to wipe our complete account with one
bad trade!

Tip #4 – Limit Your Trading

We need to protect ourselves from over trading, this usually seems like
something everyone don’t do but how many times you made nice profit
trading at the start of a day and return everything to market same or
next day? Yes this happened to more less everyone so try to have daily
limit when we talk about number of position we are going to open in one
day. This tip is mostly for day traders and if you are one of them try to
limit your trading to 3-4 trades per day and after that step outside and do
something not related to trading, go to gym, go and have a drink with
friends, go and do whatever you want just don’t trade!

Don’t matter if you are in profit or loss at the end of day, if you are in
profit great you will just protect yourself from returning money back to
broker and if you ended day with loss you will protect yourself from trying
to recover faster that usually ends completely wrong from what you have
in mind!

Tip #5 – Be Selective Trader

You won’t always get same amount of profit for each pattern that you see
on your charts, so you need to be selective and trade only things that can
make you most profit. To make it simple, we are going to define minimum
Risk To Reward that you need to follow, and that only means how much
money you are risking for how big profit. I would suggest that minimum
RR select 1:1 so if you risk 100$ you are standing to make 100$ and ideal
RR would be 1:2 so for 100$ of risk you are standing to make 200$.

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Tip #6 – Keep Trading Journal

Trading Journal for sure sounds like boring thing, but only after I started
mine I become successful, and I’m keeping adding to my journal every
day. Now the best way to start will be to open notepad and start writing
your trades, but you need to write them in this style:

Pair – Time Frame – Buy/Sell – R:R – Reason.

Example:
EURUSD 15MIN BUY 1:3 RR – BUYING BREAKOUT AFTER BULLISH
PATTERN.

Your journal is your Holy Grail strategy, each week you’ll have trades that
you can analyze and see what worked and what didn’t. By analyzing your
trades you can tweak your strategy and trade only things that work (for
example you have most winning trades on EURUSD 5min chart when we
had bullish pattern, so you will just trade EUR on 5min chart when you
find bullish pattern),

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Conclusion

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